Tuesday, June 28, 2011

[omisopzi] Fear and the value of a life

When calculating the value of a life, equivalently, the amount of money to spend preventing a given method of death, one has to do an odd calculation of the value of fear.  When one person dies, and (say) the police do nothing to prevent further deaths in the same way, then that causes fear in other people that they may die the same way.  This fear could cause a loss of productivity, money spent on self-protective measures, all of which ought to be included in the value of a life. 

For example, a school shooting could cause someone to stop attending school (for fear of also getting shot).  The entire lifetime loss of productivity due to dropping out should be included in the value of the life of the person who got shot in the school.

But fear is a weird thing to try to quantify in dollars.  It is often not rational (terrorists capitalize on this).  It can be affected by marketing, propaganda, or other psychological techniques.  Instead of trying to prevent further deaths the same way, the government could run a propaganda campaign to reduce the fear, thus increasing productivity.

Calculating the value of fear also requires looking at who is in fear: for example, if the person in fear is already low productivity, then the death that caused the productivity loss due to fear might count for less, which could lead to (or explain) police not caring about murders in poor neighborhoods.

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