Work detail

Measuring the Value of a Statistical Life in the Czech Republic: A Hedonic Wage Approach

Author: Mgr. Jakub Špiroch
Year: 2021 - summer
Leaders: prof. PhDr. Tomáš Havránek Ph.D.
Work type: Finance, Financial Markets and Banking
Language: English
Pages: 88
Awards and prizes:
Abstract: To resolve the wage-risk trade off relationship on the labor market in Czech
Republic, we introduce multiple hedonic wage regressions. Empirical theory admits an income and age heterogeneity in value of a statistical life (VSL). This
thesis employs a quantile regression along with age-dependent non-fatal and fatal on-the-job risk rates to estimate the age and income variation in VSL within
a unified framework. Our results, based on EU-SILC 2018 data, implicate an
inverted-V-shaped development of VSL with respect to age. The estimates of
age-VSL peak for workers within the age cohort 42-47 across most real wage
quantile levels and once reaching the maximum point the VSL proceeds to decline with age. In order to infer any effects of the global pandemic on VSL, we
propose a set of novel COVID-19 control variables. Additionally, we annuitize
the VSL estimates, which yields the value of a statistical life year (VSLY). The
measures of VSLY correspond to the age and income varying trend of VSL. In
conclusion, this thesis offers applicable varying VSL estimates across cohorts
and wage distribution to policy-makers and respective authorities.




Patria Finance
Česká Spořitelna