TY  - JOUR
AU  - Jena,Anupam
AU  - Mulligan,Casey
AU  - Philipson,Tomas J.
AU  - Sun,Eric
TI  - The Value of Life in General Equilibrium
JF  - National Bureau of Economic Research Working Paper Series
VL  - No. 14157
PY  - 2008
Y2  - July 2008
UR  - http://www.nber.org/papers/w14157
L1  - http://www.nber.org/papers/w14157.pdf
N1  - Author contact info:
Anupam Jena
Department of Medicine
Massachusetts General Hospital
55 Fruit Street
Boston, MA 02114
E-Mail: jena.anupam@mgh.harvard.edu

Casey B. Mulligan
University of Chicago
Department of Economics
1126 East 59th Street
Chicago, IL  60637
Tel: 773/702-9017
Fax: 773/702-8490
E-Mail: c-mulligan@uchicago.edu

Tomas Philipson
Irving B. Harris Graduate School
of Public Policy Studies
University of Chicago
1155 E. 60th Street
Chicago, IL 60637
Tel: 773/502-7773
E-Mail: t-philipson@uchicago.edu

Eric C. Sun
2940 South Ct
Palo Alto, CA 94306
E-Mail: ericsun@uchicago.edu
AB  - Perhaps the most important change of the last century was the great expansion of life itself -- in the US alone, life expectancy increased from 48 to 78 years. Recent economic estimates confirm this claim, finding that the economic value of the gain in longevity was on par with the value of growth in material well-being, as measured by income per capita. However, ever since Malthus, economists have recognized that demographic changes are linked to economic behavior and vice versa. Put simply, living with others who live 78 years is different than living with others who live only 48 years, so that valuing the extra 30 years of life is not simply a matter of valuing the extra years a single individual lives.  The magnitude by which such valuations differ is overstated when there are increasing returns to population and is understated under decreasing returns.  Focusing on the gains in life expectancy in the United States from 1900 to 2000, we find that a significant part of the value of longer life may be affected by these general equilibrium demographic effects.
ER  -