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Jun 03
2009
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The economic value of a human life is often used in public policy decision making. It is regularly used to determine the viability of mega-infrastructure projects such as highway upgrades through notorious black-spots, or tunnels to fight traffic congestion. That is, if a particular stretch of the Pacific Highway is regularly responsible (or the site of) multiple fatalities in a given year then it is a relatively straight forward calculation to determine the payback period. This would be estimated based on an economic value of Joe Citizen calculated as a formula involving life expectancy, earning capacity, net present values, discount rates, and various other economic instruments. The basic point is that human life is captialised in a trade-off against infrastructure cost.
