Paying for Permanence: Public Preferences for Contaminated Site Cleanup By

We use conjoint choice questions to investigate people’s preferences for income and reductions in mortality risks delivered by contaminated site remediation policies. Our survey is self-administered using the computer by residents of four cities in Italy with severely contaminated sites. We estimate the Value of a Statistical Life to be about €5-6 million for an immediate risk reduction. If the risk reduction takes place 20 years from now, however, the implied VSL is about €1.26 million. We estimate the discount rate implicit in the responses to the conjoint choice questions to be about 7%, and show that people are willing to pay for permanent risk reductions, but not just any amount. Risk reductions in the nearer future are valued more highly than risk reductions in the more distant future. We also find that the VSL is “individuated,” in the sense that it depends on observable individual characteristics of the respondents, familiarity with contaminated sites, concern about the health effects of exposure to toxicants, having a family member with cancer, perceived usefulness of possible government actions, and the respondent’s beliefs about the goals of government remediation programs. Additional questions suggest that respondents discount lives, even assuming away the cost of the program, and do so at discount rates in the ballpark of those implicit in the responses to the main conjoint choice questions. JEL Classification: J17 (Value of Life), I18 (Health: Government policy, Regulation, Public Health), K32 (Environmental, Health and Safety Law); Q51 (Valuation of Environmental Effects); Q53 (Air Pollution; Water Pollution; Noise; Hazardous Waste; Solid Waste; Recycling).