The value of a statistical life in assessing seismic resilience enhancement policies: A stated preference binary choice experiment

To decide about investments in appropriate seismic vulnerability reduction and resilience enhancement measures, policymakers need to acquire adequate insight into the value of a statistical life (VSL). The VSL measures the monetary value the public assigns to reducing mortality due to a specific risk (e.g., dying from an earthquake) over a given period. In the absence of appropriate models to estimate the context-specific VSL for a given community, past studies have resorted to approaches such as using the VSL estimated for other purposes (e.g., transportation and environmental safety) or other countries (e.g., the US). This can lead to under- or over-estimation of VSL, misappropriation of the funds for seismic vulnerability reduction programs, and adverse economic, political, and social consequences. This study proposes a methodology that follows the stated preference binary choice approach to estimate the willingness to pay (WTP) to reduce the risk of earthquake-induced mortalities. The proposed method, which is applied to quantify VSL in Iran, involves using a questionnaire to collect the needed information about people's choices when investing in various risk reduction measures. It uses a test containing positivity and proportionality components to check the responses’ consistency. Regression modeling is used to estimate the respondents’ WTP and VSL.