Valuing Life

There are lot of philosophical conundrums dealing with this question. For some reason, most of them involve trains and switches.

Economists have tried to answer this question using a technique called revealed preference. The idea is to look at the risks a person takes and compare the financial gain from the risk against the chance of dying. These measures are all over the place though because, while expected utility theory is beautiful mathematically, it is pretty dreadful at predicting out of sample actions. (In other words, if I see how you behave in deciding about a small risk, I can guess what you might do faced with other small risks. But if I try to guess what you'll do when facing large risks, I'll be miles off.)

Interestingly, states have also dealt with this issue in an interesting way. It turns out that a fair number of people are wrongfully convicted each year. We know that eyewitness testimony is unreliable, but it is often the best evidence we have. Nonetheless, in the fullness of time, with DNA evidence or other sorts of corroboration, many people get out of jail after having been put there despite being innocent.

The question is, how are we to compensate these individuals for the years of their life lost to prison? This is not precisely the value of a human life since an individual in prison is not dead. But from all that I have read, prison is a pretty bad place to go, so it might not be too far off from death. Or, if you believe in heaven, it is perhaps even worse than death. Regardless, it is a question that many states are now contending with.

Much like economist estimates, the legislators solutions to this problem as also all over the place. The modal answer is $70k/year. Many states offer amounts around this value. You might think the answer would vary with the cost of living, but California, a quite expensive state, offers only $36,500/year for those wrongfully convicted. One might also think that blue states would offer more than red. That too turns out to be wrong. Texas gives $80k/year while Wisconsin gives only $5k/year.

And then there are many states, like my old home state of PA, who think very little about the value of life. They offer those wrongfully convicted *absolutely nothing* for their time spent in jail. Perhaps PA jails are especially comfortable or desirable, though I've not heard that from the ex prison guards I talked to. It seems that PA is just plain mean.

A final funny story: During a legislative session in TX, a GOP legislator spoke out against any compensation. He argued that someone who was on welfare would rig a situation so that he or she will be wrongfully convicted of a crime, spend years in jail, and then have an accomplice reveal the wrongful incarceration thereby collecting the reward. While clever, the judge deciding on the validity of the legislation suggested that the congressman must have lost his mind to think that someone would willingly enter Texas jails in exchange for the cash rewards.

So how much is a human life worth? It seems to be about $80k/year if you are at risk of wrongful conviction. An absurdly small amount when one thinks about it.