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A Classification Tree for Predicting Consumer Preferences for Risk Reduction
Author(s) -
Horowitz John K.,
Carson Richard T.
Publication year - 1991
Publication title -
american journal of agricultural economics
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 1.949
H-Index - 111
eISSN - 1467-8276
pISSN - 0002-9092
DOI - 10.2307/1242394
Subject(s) - citation , session (web analytics) , library science , computer science , world wide web
Economists have long been puzzled by differences in the implicit value of life that can be inferred from consumers' responses to different risks. Individuals appear to be willing to pay more to reduce the risks from pesticide residues on food, for example, than they are to reduce the risks from increased exposure to solar radiation resulting from depletion of the ozone layer. Attempts to explain these differences have often attributed them to psychological aspects of the risks, but so far most of the analysis has concentrated on defining the risk characteristics rather than on explaining preferences (Slovic, Fischhoff, and Lichtenstein). In this paper, we attempt to explain preferences for risk reductions using the attributes of the risky substances. How do attitudes depend on risk levels, costs of risk reductions, and other features of the risky situations?