Valuation of Quality of Life Losses Associated with Nonfatal Injury: Insights from Jury Verdict Data

Evaluations of the societal burden associated with injury typically employ a cost of illness (COI) framework, focusing on direct costs, such as medical costs, and indirect costs, such as reduced productivity. However, nonfatal injuries that have long-lasting or permanent consequences can significantly reduce the quality of life for those affected. While COI evaluations are useful in demonstrating the economic burden attributable to injury, they typically do not cover quality of life losses. This study estimates the value of quality of life losses associated with consumer product injuries. We use ex post data based on jury awards in product liability lawsuits involving nonfatal product-related injuries. By combining data on monetary compensation awarded in these cases with estimates of the reduction in quality adjusted life years (QALYs) due to the injury suffered, we are able to estimate the component awarded for quality of life losses. Our findings suggest that these awards are rational and systematic, and that the most significant determinant appears to be injury severity, measured as the QALY loss. The values for life and quality of life losses implied by jury awards appear reasonable (if not somewhat low) when compared to the values obtained in the value of a statistical life literature.

Least-Cost Air Pollution Control: A CGE Joint Production Framework

Abstract This study proposes a new, more flexible approach to modeling pollution abatement activities within the CGE framework, one that treats the problem as an issue of the joint production of "good" and "bad" outputs. More specifically, this study employs a joint production technology to derive the production possibilities frontier for those industries producing both "good" and "bad" outputs. This avoids some of the difficulties associated with attempting to model separate technologies for production of the good output and pollution abatement activities. We demonstrate an application of the CGE model by estimating the cost associated with not pursuing least-cost strategies for abating air pollutants in the United States. 1 Throughout this study, the "good" output is the marketed output produced by an industry and the "bad" outputs are pollutants emitted by an industry