Environmental Economics

Valuing Reduced Asthma Morbidity in Children

  • Abstract
    Description: The large and growing population of children with asthma warrants a study on valuing reduced asthma morbidity. This study models household willingness-to-pay to minimize a specific health endpoint: morbidity effects of pollution on children with asthma (defined as asthma symptoms including coughing, wheezing and/or shortness of breath). The project addresses three main questions: 1) what determines households' perceptions of risks to an asthmatic child; 2) what averting and/or mitigating actions do households take; and 3) what are households' stated willingness-to-pay for a reduction in their children's asthma morbidity. Understanding how households assess risk is essential to advancing the modeling of household behavior. The collaborative nature of this project will provide uniquely detailed data including: risk perception, risk mitigating and averting behavior and expenditures, household income, parental/guardian education, race and employment status, household size, health indicators, sophisticated measures of lung function, ambient air pollution, and individual exposure to pollution. These detailed data will be used to estimate the revealed willingness to pay (household health production model) and stated willingness to pay (contingent valuation) for reduced asthma morbidity. We will also statistically analyze the household characteristics that are correlated with ability to correctly perceive risk to an asthmatic child. Approach: The valuation of asthma morbidity will add two surveys on household behavior to an existing epidemiological study of the effects of air pollution on asthmatic children. The study population will include children ages 6-10 with clinically diagnosed asthma, residing in a section of Fresno County, California. The economic surveys will be administered to the legal guardian of the asthmatic child. This study will administer two surveys both to maximize and refine the information gathered. Rather than assuming that households identify a distinct relationship between risk factor, risk reducing behavior and outcome, this survey will ask households to characterize groups of risk factors and any related group(s) of household responses. In the analysis of this data we will compare how households' characterization of risk factors and relevant action correlate with asthma management guidelines. The results of this survey will be used to develop and refine questions for the second survey. This project's second economic survey will have three parts. The objective of the first part is to characterize what households perceive as risks to the asthmatic child. The survey will consist of both closed- and open-ended questions. A sequence of questions will ask respondents to rank a set of possible asthma triggers. For each of the possible asthma triggers, the households will then be asked to list the asthma symptoms (for example, wheezing or coughing), the degree of severity of symptoms, and any restriction in activity due to symptoms. The second part will ask in what way the household changes its behavior in order to reduce the severity of symptoms or prevent onset of symptoms. Changes in behavior will include both those that have direct costs (medication, household investments, etc.) as well as those that are social morbidities (limiting time outside, restricting physical activity, etc.). These questions will be followed by questions regarding the expenditures for relevant averting/mitigating behaviors. The second section will close by asking about specific investments in asthma mitigating/averting behavior (such as costs of household modifications). The final part of the second survey will contain a brief contingent valuation (CV) question. The stated preference elicitation will use closed-ended, discrete-response CV, in which the respondent is presented with some potential new remedial alternative at some given cost, and asked whether she would be likely to adopt it. The double-bounded or one-and-one-half bounded format would be used, with bids designed on the basis of responses obtained in the pre-tests of the questionnaire. Expected Results: In this project we will synthesize a substantial amount of economic and epidemiological data to estimate households' subjective risk assessment, demand for mitigating and averting behavior, and stated willingness to pay for reduced asthma morbidity. The project will extend the literature on estimating the standard household health production function by explicitly modeling the household subjective risk assessment rather than assuming households correctly estimate the objective risk. We can therefore model how household characteristics affect the household's ability to correctly assess risk. The project will contribute to the stated preference literature by administering a contingent valuation survey tailored specifically to a sensitive population, children with asthma. This project will provide insight into multiple aspects of public policy directed at improving children's health. By estimating the demand for risk averting and mitigating actions, this project will help design policies to induce risk minimizing behavior in households with asthmatic children. The study will also provide direct experience in eliciting from adults their stated willingness to pay for reduced morbidity of children in their household. Improved estimates of the value of reduced morbidity of children will aid in cost-effective allocation of environmental protection resources. Supplemental Keywords: ambient air, risk assessment, vulnerability, ozone, particulates, sulfur dioxide, nitrogen oxides, nonmarket valuation, preferences, socioeconomic, survey.
  • Metadata
    Principal Investigators:
    Hanemann, Michael
    Technical Liaison:
    Research Organization:
    California at Berkeley, University of
    Massachusetts at Amherst, University of
    Funding Agency/Program:
    Grant Year:
    Project Period:
    January 1, 2002 - December 1, 2003
    Cost to Funding Agency:
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