In a recent paper [J. Hlth. Econom. 20 (2001) 131] Per-Olov Johansson claims to demonstrate that a commonly used intuitive definition of the value of a statistical life (VSL) is wrong, and that empirical estimates of VSLs are biased estimators of what he defines as the theoretically correct concept of the value of saving a life. In this comment I first argue in favor of a theoretically correct concept that is different from Johansson's because it incorporates the risk of death into the individual's lifetime budget constraint. I then show that the common intuitive definition of a VSL in fact is consistent with the theoretically correct concept and thus, provides an appropriate empirical basis for estimating the value to society of mortality-reducing projects.

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Keywords Contingent markets, Mortality-reducing projects, Value of statistical life
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Journal Journal of Health Economics
Blomqvist, Å. (2002). Defining the value of a statistical life: A comment. Journal of Health Economics (Vol. 21, pp. 169–175). doi:10.1016/S0167-6296(01)00113-8