HEALTH-HEALTH ANALYSIS - A NEW WAY TO EVALUATE HEALTH AND SAFETY REGULATION

Regulations to promote health and safety that are exceptionally costly relative to the expected health benefits may actually worsen health a nd safety, since compliance reduces other spending, including private spending on health and safety. Past studies relating income and mortal ity give estimates of the income loss that induces one death-a value t hat we call willingness-to-spend (WTS)-to be around $9 to $12 million. Such estimates help identify regulations that do not improve health a nd safety, and moreover, fail benefit-cost comparisons. WTS is a multi ple of the willingness to pay to avert a statistical death. Internatio nal data yield estimates of WTS and willingness-to-pay in different co untries.