The approach to modeling the value of statistical life using average per capita income

TL;DR

This paper proposes a simplified model to estimate the value of statistical life in Ukraine based on demographic data and average income, revealing that current valuations are significantly undervalued.

Contribution

It introduces a new approach using demographic and income data for modeling the value of statistical life, demonstrating its efficiency over previous methods.

Findings

The value of statistical life in Ukraine is undervalued.

The proposed model is simpler and more efficient than previous methods.

Regression analysis confirms the model's applicability.

Abstract

The problem of determining the value of statistical life in Ukraine in order to find ways to improve it is an urgent one now. The current level of value is analyzed, which is a direct consequence of the poor quality of life of a citizen, hence his low level. The description of the basic theoretical and methodological approaches to the estimation of the cost of human life is given. Based on the analysis, a number of hypotheses have been advanced about the use of statistical calculations to achieve the modeling objectives. Model calculations are based on the example of Zaporozhye Oblast statistics for 2018-2019. The article elaborates the approach to the estimation of the economic equivalent of the cost of living on the basis of demographic indicators and average per capita income, and also analyzes the possibilities of their application in the realities of the national economy. Using Statistica, the regression equation parameters were determined for statistical data of population distribution of Zaporizhzhia region by age groups for 2018. The calculation parameters were also found using the Excel office application, using the Solution Finder option to justify the quantitative range of metric values. It is proved that the proposed approach to modeling and calculations are simpler and more efficient than the calculation methods proposed earlier. The study concluded that the value of statistical life in Ukraine is significantly undervalued.