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INFORMATION AND THE LIFE CYCLE CONSUMPTION OF HAZARDOUS GOODS
Author(s) -
IPPOLITO PAULINE M.
Publication year - 1981
Publication title -
economic inquiry
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.823
H-Index - 72
eISSN - 1465-7295
pISSN - 0095-2583
DOI - 10.1111/j.1465-7295.1981.tb00337.x
Subject(s) - consumption (sociology) , hazard , irrational number , hazardous waste , life expectancy , expectancy theory , actuarial science , economics , value (mathematics) , public good , risk analysis (engineering) , information asymmetry , public economics , business , microeconomics , engineering , computer science , environmental health , medicine , population , sociology , social science , chemistry , geometry , mathematics , organic chemistry , management , machine learning , waste management
Safety is a major area of public concern. The fact that people take risky occupations, smoke or fail to use seat belts often provokes a regulatory response designed to either protect people from the risks directly or to provide them with more information on the hazards involved. Such policy is often based on the view that risk‐taking behavior is irrational or ill‐advised. This paper develops life cycle models of the decision to consume hazardous goods. A particular focus of the analysis is to consider the rational response to information about hazards. Rational consumption of a hazardous good is shown to depend on such factors as the nature of the hazard, age, life expectancy, age at which information on the hazard was received and, of course, the underlying value of the good itself.