Get 20M+ Full-Text Papers For Less Than $1.50/day. Start a 14-Day Trial for You or Your Team.

Learn More →

Economics of Health Risk Assessment

Economics of Health Risk Assessment The methods that scientific and technical experts have developed for constructing quantitative assessments of health and safety risks have major shortcomings as tools for decision analysis. We use a model of cost-effective risk management under uncertainty to discuss shortcomings of standard risk assessment methods as decision support aids, including problems of ( a ) comparability of risk estimates and costs of saving statistical lives from compounded conservatism and ( b ) lack of flexibility in modeling regulatory intervention. Offsets and risk shifting due to regulation-induced changes in firm and household behavior show that risk assessments need to incorporate economic and behavioral science models. Empirical studies demonstrate that the tools of economic analysis can help risk assessments generate much richer information sets both at the overarching level of embedding risk assessments in decision-theoretic frameworks for risk management decisions and at the internal level by giving risk assessments the capacity to capture the effects of behavioral changes on risk. http://www.deepdyve.com/assets/images/DeepDyve-Logo-lg.png Annual Review of Resource Economics Annual Reviews

Economics of Health Risk Assessment

Annual Review of Resource Economics , Volume 2 (1) – Oct 10, 2010

Loading next page...
 
/lp/annual-reviews/economics-of-health-risk-assessment-w0jmmU0tJo

References (71)

Publisher
Annual Reviews
Copyright
Copyright © 2010 by Annual Reviews. All rights reserved
ISSN
1941-1340
eISSN
1941-1359
DOI
10.1146/annurev-resource-040709-135045
Publisher site
See Article on Publisher Site

Abstract

The methods that scientific and technical experts have developed for constructing quantitative assessments of health and safety risks have major shortcomings as tools for decision analysis. We use a model of cost-effective risk management under uncertainty to discuss shortcomings of standard risk assessment methods as decision support aids, including problems of ( a ) comparability of risk estimates and costs of saving statistical lives from compounded conservatism and ( b ) lack of flexibility in modeling regulatory intervention. Offsets and risk shifting due to regulation-induced changes in firm and household behavior show that risk assessments need to incorporate economic and behavioral science models. Empirical studies demonstrate that the tools of economic analysis can help risk assessments generate much richer information sets both at the overarching level of embedding risk assessments in decision-theoretic frameworks for risk management decisions and at the internal level by giving risk assessments the capacity to capture the effects of behavioral changes on risk.

Journal

Annual Review of Resource EconomicsAnnual Reviews

Published: Oct 10, 2010

There are no references for this article.