Mortality Risk, Insurance, and the Value of Life

People with shorter life expectancies place more value on increases in survival than people who anticipate longer life spans. That may seem obvious, but economists have been making the opposite prediction for decades. Daniel Bauer, Darius Lakdawalla, and Julian Reif demonstrate the mistake in the earlier theory and point out important policy implications, including that payers and governments are undervaluing investments in treating highly severe illnesses. Read the full column at Vox EU.