The Economic Value of Health Improvements in Drinking Water

EPA Grant Number: R833264
Title: The Economic Value of Health Improvements in Drinking Water
Investigators: Viscusi, W. Kip , Huber, Joel
Institution: Vanderbilt University , Duke University , Knowledge Networks
EPA Project Officer: Hahn, Intaek
Project Period: September 1, 2006 through August 31, 2008
Project Amount: $675,173
RFA: Valuation for Environmental Policy (2004) RFA Text |  Recipients Lists
Research Category: Economics and Decision Sciences


The goal of this research is to use stated choice methods to valuate several different benefit values associated with reduction in morbidity risks due to drinking water contamination. The focus will be on acute and chronic problems associated with gastrointestinal illness. We have chosen this focus for the research because of the familiarity that most people have with this type of illness, which will facilitate the rational valuation of risk reduction. In addition, the project will continue to develop validity tests for the Knowledge Networks survey methodology that we began with our work on the value of water quality for purposes other than drinking water, in particular, for swimming, fishing, and aquatic uses.


This project will estimate the value of safer drinking water using a series of surveys on a nationally representative sample. The computer-based survey approaches to be used will include iterative paired comparisons of market-based regional choices and choice-based conjoint analysis of benefit components including probability, severity, latency, and duration of illness. That is, respondents will make choices between regions that differ on the probability that they will experience gastrointestinal illness, on the severity (e.g., vomiting, nausea) if it occurs, on the latency or time between ingestion and illness, and on the duration of the illness.

Expected Results:

The series of questions will serve as input for regression models that predict value of reductions in morbidity risks and utility tradeoff rates for related disamenities (duration, severity, etc.) based upon demographic and other characteristics of respondents. Thus, rather than generating values for narrowly defined disease groups, the study will produce economic values of the component attributes of different illnesses, making it possible to project values to a variety of health outcomes. The study will also include validity tests of Knowledge Networks panel.

Supplemental Keywords:

ecological benefits, conjoint, iterative choice, stated preference surveys, random utility model,

Progress and Final Reports:

  • 2007
  • Final