Saturday, July 12, 2008

Depreciation in the Value of an American Life?

The EPA announced recently that the statistical value of an American life has depreciated to 6.9 million US dollars, which is a drop of $1 million from five years ago.

While this is all just statistics, there might be legal implications to the statistical value of an American life. Is $6.9million (or $7.9million five years ago) sufficient to purchase a life? Perhaps some lawyers may be tempted to cite this statistics to put a cap on legal damages.

If we use Euro to measure the statistical value of an American life:
  • 5 years ago, (assuming exchange rate US$1 to 0.9Euro): 7.11 million Euro
  • Today, (assuming exchange rate of US$1 to 0.63Euro): 4.35 million Euro
So the depreciation is almost 40% over the past 5 years, in terms of Euro!!!

There should be plenty of argument against putting a price tag on human life. Whatever the reason for the EPA to put a monetary measure on a statistical life, the number is probably controversial at best.

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