If you are teaching environmental economics this semester you might be approaching that touchy time of the semester when the subject is valuing lives*. If you need an example for why this is important, yesterday's soot rule decision by EPA admin Johnson is a good one (E.P.A. Chief Rejects ...):
The Environmental Protection Agency’s administrator on Thursday rejected the recommendations of his staff — and an unusual public plea from independent science advisers — choosing instead to tighten only one of two standards regulating the amount of lethal particles of soot in the air.
The short-term daily standard, intended to control acute exposure to the minute particles, was cut nearly in half. But the annual standard, which affects chronic exposure, remains at its original 1997 level.
A large volume of research has implicated the soot particles — which are less than one-thirtieth the diameter of a human hair and can penetrate deep into the lungs and the circulatory system — in tens of thousands of deaths annually from both respiratory and coronary disease. Scientists say they are among the deadliest contaminants to which the public is regularly exposed and for which the E.P.A. sets exposure levels.
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Joel Schwartz, an epidemiologist at the Harvard School of Public Health who has written many peer-reviewed papers on the health effects of particulates, said lowering the standard to the level urged by the science advisers would prevent 3,000 premature deaths annually.
Using $4 million as the value of a statistical life (2000 dollars), the benefits of changing the annual standard might be $12 billion anually. The stated reason why the EPA decided not to change the annual rule and forego these benefits is uncertainty about avoiding the 3000 premature deaths:
Asked about the health-related benefits of the tighter standard for daily exposure, he [Johnson] cited the agency’s statistical estimates that the new rule would avoid an estimated “2,500 premature deaths in people with heart or lung disease; 2,600 chronic bronchitis cases; 5,000 nonfatal heart attacks,” among other improvements. He said he could not provide estimates for the benefits associated with toughening the annual standard to 14 micrograms from 15.
*Note: Previous post on this subject: What are you worth?