Human Life in a Cost-Benefit Analysis

4 minute read


While reading Damon Coppola’s Introduction to International Disaster Management, I was struck by the unequivocal denouncement of cost-benefit analyses of disaster mitigation with respect to human life.  In listing three criticisms of the process of determining risk acceptability, number two reads:

Setting a dollar figure (in cost-benefit analyses) on a human life is unethical and unconscionable . . . Because of the controversial nature of placing a value on life, it is rare that a risk assessment study would actually quote a dollar figure for the amount of money that could be saved per human life loss accepted.  Post-event studies have calculated the dollar figures spent per life during crisis, but to speculate on how much a company or government is willing to spend to save or risk a life would be extremely unpalatable for most.

The emphasis is not mine. I had two initial reactions.  First, setting a dollar figure on human life is common practice in many settings.  The EPA is a common example, and currently has their carefully defined value of statistical life set at 7.4 million (in 2006 dollars). In an oft cited article, Viscusi and Aldy review over 100 articles that measure how individuals value morbidity risk.

The second thought was to consider who in the emergency management field would benefit or lose from Coppola’s forbidden analysis. My former Princeton colleague Sarah Bush, now an Assistant Professor at Temple University, began quantifying the benefits of NGO democracy promotion programs to keep up with the shifting preferences of their donors. In that transition, there were certainly winners and losers among the NGOs.

Two pieces the last couple week put these questions to a wider audience.  First, Peter Singer’s NYT column pitted charity categories against each other resulting in a thought experiment where you would visit a new museum wing if doing so gave you a 0.1% chance of suffering 15 years of blindness. With this bizarre would-you-rather, Singer advocates for the evidence-based approach to charity known as Effective Altruism.

Second, Professor Chris Blattman strongly criticized charities that eschew impact appraisals. In a recent episode of This American Life looking at the best way to give that features Blattman, the vice-president of Heifer International responds to a question about an experiment where one village gets cows and training and another village gets an equivalent amount of cash. She says, “It sounds like an experiment, and we’re not about experiments. These are lives of real people and we have to do what we believe is correct. We can’t make experiments with people’s lives. They’re just– they’re people. It’s too important.”

To Blattman, this is the crux of the matter.  He writes, “Let me be blunt: This is the way the Heifers of the world fool themselves. When you give stuff to some people and not to others, you are still experimenting in the world.” Blattman admits that ignoring someone is easier than talking to someone and measuring their outcomes without giving them anything, which may be part of why Heifer feels the latter is immoral.  Blattman could not disagree more, saying that in a world with limited resources it is immoral not to take measurements.  If in fact a poor family does twice as well with cash than with cattle, then each person Heifer helps is in essence withholding aid from another through opportunity costs.  Of course we don’t know if this is the case, but the point is that ignorance is not only bliss, it’s cruel.

Both Singer and Blattman are taking part in the discussion about a new charity, GiveDirectly, but they speak to part of what really bothered me about the paragraph in Coppola. Decision-making in disaster preparedness, mitigation, response, and relief with a cost-benefit analysis that considers human life feels like playing god, choosing who lives and who dies.  However, avoiding that analysis does not absolve you from making life and death decisions, you just do so with even less information.  We do not know if those uninformed actions may result in the further loss of life, but it seems immoral not to find out.

[Edited for grammar]