Advances in Evaluating the Demand for Risk Prevention Policies

PWP-CCPR-2005-051

Abstract

We evaluate several concerns related to measuring the demand for public risk prevention policies, using an innovative national survey and new modeling strategies. We find that the omission of avoided morbidity leads to an upward bias in estimates of the marginal utility of avoided deaths. Individuals experience diminishing marginal utility in the scope of mortality- and morbidity-reducing policies. Individual attitudes towards government involvement and, particularly, perceptions of the personal benefits of different policies, appear to be important determinants of demand. Finally, we uncover little evidence of heterogeneity in demand for public health policies according to the proximate health threat (e.g. cancer, stroke, respiratory disease, injury) or the underlying cause (e.g. exposure to contaminants in air, water, food; highway hazards).