The Life Satisfaction Approach to the Value of Public Goods: The Case of Terrorism
نویسندگان
چکیده
This paper discusses a novel approach to elicit people’s preferences for public goods, namely the life satisfaction approach. Reported subjective well-being data are used to directly evaluate utility consequences of public goods. The strengths of this approach are compared to traditional approaches and identification issues are addressed. Moreover, it is applied to panel data to estimate utility losses caused by terrorist activities in France, the UK and the Republic of Ireland. Terrorism in these countries depresses life satisfaction in a sizeable and robust way. In combination with low marginal utility of income we estimate high compensation surpluses. (97 words) JEL classification: D61, D74, H41, H56, I31
منابع مشابه
The life satisfaction approach to valuing public goods: The case of terrorism
Terrorism has large social costs that are difficult to quantify for the well-known problems of eliciting people’s preferences for public goods. We use the LSA to assess these costs in utility and monetary terms. Based on combined cross-section time-series data, we estimate the costs of terrorism for France and the British Isles. We find large negative effects of terrorism on life satisfaction t...
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