The value of statistical life and cost–benefit evaluations of landmine clearance in Cambodia

Abstract

Development agencies spend approximately US$400 million per year on landmine clearance.Yet many cost-benefit evaluations suggest that landmine clearance is socially wasteful because costs appear to far outweigh social benefits. This paper presents new estimates of the benefits of clearing landmines based on a contingent valuation survey in two provinces in rural Cambodia where we asked respondents questions that elicit their tradeoffs between money and the risk of death from landmine accidents. The estimated Value of a Statistical Life (VSL) is US$0.4 million. In contrast, most previous studies of landmine clearance use foregone income or average GDP per capita, which has a lifetime value of only US$2,000 in Cambodia. Humanitarian landmine clearance emerges as a more attractive rural development policy when appropriate estimates of the VSL are used. Keywordsbenefit-cost analysis contingent valuation landmines value of statistical life JEL Codes J17; O22 AcknowledgementsWe are grateful for funding from the Waikato Management School and the Asia 2000 Foundation and to assistance from the team of Cambodian interviewers, and especially the respondents. The paper has also benefited from the comments of audiences at the AARES and NEUDC conferences and a seminar at the Australian National University. All errors and omissions are the responsibility of the authors.3

Landmines and Spatial Development

“…Finally, our paper contributes to practitioner/applied works on the topic (e.g., Cameron, Gibson, Helmers, Lim, Tressler, and Vaddanak (2010), Keeley (2006) and Elliot and Harris (2001)) and the mostly qualitative studies of demining operators and development agencies (summarized in the annual editions of Landmine Monitor).…”

The effect of explosive remnants of war on global public health: a systematic mixed-studies review using narrative synthesis

“…14,45,49,52 Results from cost-benefit studies of landmine clearance were variable and largely dependent on the value assigned to death and injury. Two studies 27,35 reported a negative net present value and four 24,31,34,48 reported a positive net present value (appendix p 12). A Bosnian study 49 estimated future costs from remaining landmines at US$36 million, but concluded that mine clearance was not a postconflict development priority for the country.…”

“…Value-of-life estimates mark a shift away from conventional valuing of death and injury in terms of the value of an individual's lost earnings, now considered to greatly underestimate the value of life. 24,71 The most comprehensive measures of cost benefit are those that use value-of-life estimates and measure the effect of landmine or UXO clearance on child health, child educational attainment, sustainable livelihoods, socioeconomic development, and agriculture. An improved understanding of the physical and psychological effects of injury from landmines or UXO also has important implications for health-care policy.…”

Valuing Flood Risk Reductions

“…9 Since a flood management policy aiming at reducing the mortality rate will typically benefit to all household members, this attribute was presented in the CE in the following way: "Chance per year that you or one member of your household may die in case of a flood (fatality rate due to floods)." In explanations provided to respondents, it was made explicit that this attribute had to be interpreted as the chance per year for the next 10 years that one member of the household may die due to a flood.…”

“…They find a VSL between 0.74 and 1.48 million USD. Using a CV approach in rural Cambodia, [9] report a mean VSL equal to 446,196 USD based on a reduction of death risk due to landmine accidents.…”