Working Papers
- Valuing a Reduction in the Risk of Non-Fatal Cancer (under review, Environmental and Resource Economics) with D. Herrera-Araujo, H. Andersson, D. Dussaux & O. Byström. OECD Environment Working Papers, 2026. [link]
Abstract
Cancer is associated with various environmental contaminants and chemicals, including heavy metals, pesticides, as well as foodborne and waterborne pathogens. Many of these hazards are subject to regulation, or may be considered for regulation, to reduce exposure and prevent human health risks. In addition to the well-known significant mortality risks, cancer also causes substantial morbidity, including debilitating symptoms and treatment side effects that severely impact patients' quality of life. Despite this, there has been no comprehensive study of the morbidity of cancer, making it difficult to fully assess the broader burden and economic implications of cancer. This paper is part of the series of large-scale willingness-to-pay (WTP) studies resulting from the Surveys on Willingness-to-pay to Avoid Negative Chemicals-Related Health Effects (SWACHE) project that intends to improve the basis for doing cost benefit analyses of chemicals management options and environmental policies in general. The present paper details a stated preference survey estimating the value of avoiding a case of non-fatal cancer (VNF). The SWACHE non-fatal cancer survey was fielded in 10 countries: Canada, Denmark, Estonia, Japan, Mexico, Norway, Slovenia, Spain, the United Kingdom and the United States. In each country, a sample of approximately 1 200 individuals representative of the general population was collected and empirically analysed. Based on this survey, the mean VNF is USD2023 Purchasing Power Parity (PPP) 883 000. The VNF ranges from USD2023 PPP 559 000 in Mexico to USD2023 PPP 1 266 000 in the United States.
- Equity-Weighted Benefit–Cost Analysis for Air-Quality Policy: A Framework and Application to France with D. Herrera-Araujo. Working paper.
Abstract
Conventional benefit–cost analysis (BCA) treats every euro identically despite large socioeconomic inequalities in ambient air pollution and pollution-attributable mortality. This paper assesses how policy evaluation changes when equity is introduced explicitly through a social welfare function (SWF) framework applied to French PM2.5 policy. Using 2020 department-level data on PM2.5, mortality, life tables, equivalised income, and an imputed age–wealth profile, we construct an equity-weighted BCA for four stylised one-year PM2.5 reduction policies, calibrated to deliver similar aggregate mortality gains but distinct distributional incidence. The framework replaces a single value of a statistical life with three subgroup-specific willingness-to-pay measures and applies utilitarian and prioritarian SWFs over wealth- and income-based welfare proxies. Aggregate gross benefits range from €6.6–€23.5bn across policies and WTP approaches. Under wealth weights, all four policies deliver negative net utilitarian welfare, with higher-income targeting preferred over most of the inequality-aversion range and lower-income targeting overtaking only at high aversion levels. Replacing wealth with income flips both signs and rankings substantially. Equity-weighted BCA is implementable with routinely available data, but its conclusions depend materially on the choice of welfare proxy and cost-allocation rule. Appraisals of environmental and health policies should therefore report equity-weighted alongside conventional BCA, with explicit sensitivity to these two modelling choices.
- Equivalent Income and Distributional Weights in Benefit–Cost Analysis: Evidence from Six Countries Working paper, single-authored.
Abstract
Standard benefit–cost analysis (BCA) converts gains and losses into monetary terms and aggregates them across individuals, but largely ignores how impacts are distributed. Distributionally weighted BCA addresses this by incorporating equity weights derived from a social welfare function, yet existing approaches focus narrowly on income or rely on normative assumptions that are difficult to justify empirically. This paper implements the equivalent income (EI) framework as an alternative. EI maps each individual's bundle of income and health into the level of income that would yield equivalent utility under perfect health, thereby generating distributional weights that account for heterogeneity in both dimensions. Using a large-scale stated-preference survey conducted across six European countries (France, Italy, Spain, Greece, Poland, and Sweden) with more than 8,000 respondents, individual EI is estimated via interval regression on double-bounded willingness-to-pay for health improvements and aggregated across income quartiles and health severity levels. The results show that EI-based weights place greater importance on individuals with lower income and worse health than existing approaches do, with the relative weight assigned to poor health declining with income, reflecting substitutability between income and health at higher income levels. Crucially, redistribution arises endogenously from individual ordinal preferences rather than from external normative assumptions, and even under low inequality aversion the framework assigns substantially greater weight to individuals at the lower end of the welfare distribution. The EI framework thus offers a tractable and theoretically grounded approach to distributional weighting that can meaningfully alter the evaluation of health and environmental policies.
- Willingness-to-Pay for Environmental Health: A QALY-Based Study Across Europe with D. Herrera-Araujo, S. Navrud, H. Lindhjem, G. Appéré & M. Travers. Working paper.
Abstract
We estimate individuals' willingness to pay (WTP) for environmental health improvements using a harmonized survey across six European countries (France, Italy, Spain, Greece, Poland, and Sweden). The study adopts a Quality-Adjusted Life Year (QALY) framework and presents hypothetical illness episodes that vary in severity and duration, allowing us to identify how respondents trade off short, severe conditions against longer, milder ones. To compare prevention and treatment valuations, respondents are randomly assigned to a probability module or a certainty module. The probability module employs a discrete choice experiment to elicit WTP for reductions in fatal and non-fatal health risks, while the certainty module uses a double-bounded dichotomous choice design to elicit WTP for faster recovery from an existing illness; respondents failing probability training are reassigned to the certainty module. We further test for disease-specific premiums by randomly labeling health states. The estimates provide policy-relevant values for morbidity and mortality in environmental cost-benefit analysis across Europe.
- Monetary Valuation of Pollution-Related Morbidity: A Review of Evidence from 2006–2023 with S. Åström, A. Eriksson, S. Schucht, G. Appéré, M. Travers, et al. Working paper.
Abstract
This study reviews the economic valuations of morbidity, related to air and chemical pollution, addressing a data gap in current socio-economic impact assessments used to support environmental and health policies. We analysed literature from 2006 to 2023, covering 22 relevant health effects. The review process initially identified 10,243 studies, of which 298 unique studies were included. From these, 540 values were extracted. The studies were categorized based on several attributes, including the definition of the health effect, country of focus, study methodology, cost approach (incidence or prevalence), cost categories (direct, indirect, and disutility), and cost components. We standardized the results to annual timeframes where possible, and adjusted values to €2020 for consistency. Premature birth, dementia, lung cancer, and hypertension were found to have the highest economic values. Heart failure emerged as the condition with the most available studies, particularly regarding direct medical expenditures. The review highlighted a lack of economic valuations for reproductive system disorders, signalling an area for future research. The findings offer valuable insights into the economic costs of various conditions, uncovering significant patterns and identifying sufficiently robust valuations that can complement existing pollution policy cost-benefit analysis (CBA) models, such as CaRBonH and BenMAP. However, considerable variation exists both within and between health effects and cost categories, primarily due to the diverse methodologies used across studies. This review underscores the urgent need for standardized approaches in environmental health economics to inform and strengthen policy decisions.