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Number: 

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Printed 11/20/200810:28:18AM Sheet 5of 91^ 9 08O 4 TEL : ° C t ll9 1 14:1 8 No

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'OCT , 1 -9 1 12:0 9 FRO M RTP-AQM D TOOflQP S PAGE.00 2

Poin t Estimate s o

f th e Valu e o

f aStatistica

l j^if e Lelan d B - Deck , Ph.D . Ambien t Standard s Branch , OAQPS , OA R I n thi s not e 1 revie w "Th e Valu e o f Reducin g Risk s o

f Death : A Not e o n Ne w Evidence * b y Fisher , Chestnu t an dVlolette (Journa

l o f Polic y Analysi s an d Management . 1989 ) t o determin e a n appropriat e poin t estimat e fo

T avalu e o

f statistical lif

e fro mth e evidenc e the y presen t Th e pape r

i s th e publishe dversio n o f th e workin g pape r

recentl y use db y some a s th e citatio n fo r estimate s o

f th e valu e o f astatistical life . Th e pape r

review s 2 1 studies , an dpresent s 22 estimates 1 o f th e rang e an da "judgmental bes t

estimate " o

f th e valu e o

f astatistical life . Th e author s sugges t tha t som e o f th e studie s hav e methodologica l problems , an dshoul dno t b e viewe d a s credible . Eliminatin g th e studie s Judge dproblemati c leave s 1 3 estimates . Th e "judgmenta

l bes t estimate " o

f thes e 1 3 studie s ha s arang e o f $1. 6 to $8. 5 millio n (198 6 $) . Fishe

r et . al . sugges t

thi s rang e b e use dfo

r polic y analysis . Descriptiv e statistic s o n th e variou s estimate s ar e attache da s Tabl e 1 . Th e attache ddiagra mdepict s th e distributio n o f th e "best " estimate s fo

r th e 1 3 selecte d estimates , wit

h th e hig h an dlo w estimate s als o shown . Occasionall y analyst s nee dt o us e apoin t estimat e valu e fo

r som e sort s o

f analysis . Th e appropriat e poin t estimate t o us e I s amatte r o f judgement . Ther e ar e severa l possibilities , including : P. 2



### FE B *Som e paper s presen t

mor e than on e estimat e du e t o differen t data , assumptions , etc - Ther e ar e 2 2 estimate s that Includ e both th e rang e an da"best " value . Thre e additiona l estimate s d o no t includ e a"best " value .TEL : Oc t 1,9 1 14:1 8 No.UU b P.0 4 P3 - 62 9 083 4 •OC T 1 '9 1 12:1 0 FRO M RTP-AQM D T O OAQP S PAGE.00 3 

### 2 1 ) Th e mea n o f th e extreme s o

f th e 1 3 studies , $5-0 5 million 2 ) Th e mea n o f all 1 3 studies , $4.3 7 million 3 ) Th e media n o f all 1 3 studies , $3.70 million Th e leas t defensibl e o f thes e measure s i s th e mea n o f th e extremes . Suc

h a measur e i s only base do n 1 estimates , an dignore s al l o f the othe r informatio

n provide db y th e other

studies - Th

e mea n o r media n o f th e variou s estimate s ar

e bette r measures , a s they us e all o f th e available information . OMB' s recen

t "Regulator

y Impac t Analysi s Guidance" , i

n the Regulator

y Progra mo f th e Unite dgtate s Governmen t (1989) , discusse s th e selection o f poin t estimate s fro

mavariet y o f studies . "I n general , i t

i s no t appropriat

e t o us e the midpoin

t o f th e rang e o

f extrem e value s provide db

y the studies . Suc

h atechnique ignore s th e information provide db y all studie s excep t thos e providin g the extrem e values , whic

h ma y b e the leas t

reliable . Th

e preferred approach t o derivin g th e most-likel y estimat e o f aparticula

r paramete r in thi s situatio n woul db e to deriv e i t a s aweighted averag e o f th e estimate s o

f the individua

l studies , wit

h th e weigh

t o f eac h estimat e being basedo n the reliabilit y (i n the bes t judgmen t o f the agency) o

f th e study tha

t producedIt. " ( p 567

) I recommen

dusin g the rang e o

f value s presente db y Fishe r e t al . whe n conducting mortalit

y ris k reductio n benefit

s analysi s w e perform . Whe n necessar y to us e apoin t

estimate , I recommen

dusing the mea

n ($4. 4 million

) o f th e credibl

e studies .Oc t1.9 1 1 4 = 1 8 iNloJOOS ' P.5 4 T O OflQP S PAGE.00 4 P. 4 62 9 08D 4 •OC T 1 '9 1 12:1 0 TEL : FRO M RTP-AQ-M D

TABL E 1 , D^gapfiffijtaj ^ AjLPjge s (2

2 estimates )
mea n media n mea n o f extremes rang e lo w

2.6 0 1. 9 43 7 .2 4 - 9.0 "best

" 3.0 5 2.6 5 4.4 7 .45-8. 5 high

4.0 5 3. 2 7.7 3 M - U. 9 Sglgc^lBpgff

i (1 3 estimates )

lo w mea n media n mea n o f extremes rang e 3.7 0

3.6 0 5.0 5 "best

" 43 7 3.7 0 5.0 5 high 5.7 7 3.90 8.2 5 rt - « c , H

R1. 6 - 14.9 1, 6 - 8, 5 I * ' * °62 9 080 4

OC T 1 »9 1 12*1 0

. > t TEL : FRO M RTP-AQM D Oc t 1,9 1 14:1 8 No.00 6 P.0 5 T O OflQPS PfiGE.00 5


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