Any revision of this paper will include a citation to:
Banzhaf, H Spencer. 2014. "Retrospectives: The Cold-War Origins of the Value of Statistical Life." Journal of Economic Perspectives, 28(4): 213-26.
Abstract
This paper traces the history of the "Value of Statistical Life" (VSL), which today is used routinely in benefit-cost analysis of life-saving investments. The "value of statistical life" terminology was introduced by Thomas Schelling (1968) in his essay, "The Life You Save May Be Your Own." Schelling made the crucial move to think in terms of risk rather than individual lives, with the hope to dodge the moral thicket of valuing "life." But as recent policy debates have illustrated, his move only thickened it. Tellingly, interest in the subject can be traced back another twenty years before Schelling's essay to a controversy at RAND Corporation following its earliest application of operations research to defense planning. RAND wanted to avoid valuing pilot's lives but the Air Force insisted they confront the issue. Thus, the VSL is not only well acquainted with political controversy; it was born from it.
https://www.aeaweb.org/articles.php?doi=10.1257/jep.28.4.213
Because, as the context may dicate, we are valuing lives (and people don't seem to like it) instead of risk changes (and we have changed the title to indicate just that).
