Working Paper: NBER ID: w12836
Authors: Javier A. Birchenall; Rodrigo R. Soares
Abstract: This paper accounts for the value of children and future generations in the evaluation of health policies. This is achieved through the incorporation of altruism and fertility in "value of life" type of framework. We are able to express adults' willingness to pay for changes in child mortality and also to incorporate the welfare of future generations in the evaluation of current policies. Our model clarifies a series of puzzles from the literature on the "value of life" and on intergenerational welfare comparisons. We show that, by incorporating altruism and fertility into the analysis, the estimated welfare gain from recent reductions in mortality in the U.S. easily doubles.
Keywords: Altruism; Fertility; Value of Life; Health Policy; Intergenerational Welfare
JEL Codes: I10; J13; J17
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| Altruism and fertility (D64) | willingness to pay for changes in child mortality (J17) |
| willingness to pay for changes in child mortality (J17) | welfare gains from mortality reductions (J17) |
| Altruism and fertility (D64) | welfare gains from mortality reductions (J17) |
| emotional loss associated with child death (J17) | willingness to pay for changes in child mortality (J17) |
| uncertainty regarding number of surviving children (J13) | willingness to pay for changes in child mortality (J17) |