Value of life and behavior toward health risks: an interpretation of social capital
Article first published online: 7 SEP 2005
Copyright © 2005 John Wiley & Sons, Ltd.
Volume 15, Issue 2, pages 159–171, February 2006
How to Cite
Folland, S. (2006), Value of life and behavior toward health risks: an interpretation of social capital. Health Econ., 15: 159–171. doi: 10.1002/hec.1022
- Issue published online: 17 JAN 2006
- Article first published online: 7 SEP 2005
- Manuscript Accepted: 31 MAY 2005
- Manuscript Received: 31 MAR 2004
- value of life;
- compensating wages;
- social capital;
- health risky behaviors
An individual assessing a risky job can be understood as a public good. He and each of his valued relationships place a demand for the preservation of his life and health for which he accepts a responsibility to preserve. Additional demands generally do not deplete his capacity for beneficial relationships, hence, they are nonrival. It follows that the more extensive are his relationships the greater is his social capital. Although a common metric to compare and aggregate such relationships is not practical, the paper demonstrates that the common social capital indicators can yield qualitative predictions on changes in risky behaviors in the context of conventional value of life models familiar within health economics. The individual will change his behavior toward risk upon experiencing an exogenous change in his social capital: when he marries, has children, acquires friends, or experiences a more socially active community. The empirical sections of the paper show this prediction to conform well to prior studies of micro data as well as to original empirical analysis of aggregate data. Copyright © 2005 John Wiley & Sons, Ltd.