Economic Value of Life in Iran: The Human Capital Approach

The human life value is among the most important challenges of the health economic evaluation. This limitation has reduced the feasibility of applying the cost-benefit method in evaluations of health interventions and policies. Using the human capital approach and discounted value of future earnings, the present study calculated the human capital of different age groups. The required data were obtained using "income and expenditures of Iranian households" data in 2015 from the Statistical Center of Iran, which included the information on 19380 urban households. According to the calculation of human capital, the maximum value of a statistical life year in the high-income group was related to the age group of 30-34 yr old (223,286 US$ equals to 9378 million Iranian Rials). The lowest value in all three groups of high, medium and low income is related to the age group of 85 and older. In addition, the economic value of statistical life year for men has been calculated as higher than that of women, however, in older age groups, the human capital of both genders have been converging. The economic value of life for young people aged between 20 to 30 yr was higher than other demographic groups. The findings of the research help to provide a more accurate base for the cost-benefit analysis of health and social policies. Considering the economic value of the statistical life for different age groups may change policy priorities in areas related to health and life of human beings.