How Much Does the Human Life Cost?

The desire to calculate the value of the human life for different purposes has existed for a long time. The concept of the human life valuation is crucial since it might be implemented in various spheres of scientific endeavor such as economics and medicine. Although researchers around the world studied this issue and developed a plethora of assessment methods depending on time and purpose, only few studies have focused on the Russian data. Thus, the purpose of this study was to answer the following research question: How much does the human life cost in the Russian Federation? The following objectives were established to achieve this goal: 1. The origin and meaning of the concept of the human life valuation were studied; 2. The existing approaches to the valuation of the human life and their applicability were analysed and compared; 3. The estimation of the human life in the Russian Federation was derived based on the value of a statistical life approach; 4. The variation of the human life estimations depending on socio-demographic characteristics of the economically active population in Russia was estimated. The study draws on the economically active population aged 16-59 years of the Russian Federation divided by federal districts, for which purpose the data are taken from the Russia Longitudinal Monitoring Survey of the Higher School of Economics (RLMS-HSE) for the year 2018. The research is based on the conceptual framework, which implements the hedonic wage model for the estimation of the value of a statistical life. First of all, the effects of socio-demographic characteristics of respondents on the real wage rate in 2018 were estimated by the regression analysis. Further, the value of a statistical life was calculated applying the marginal impact of risk on the logarithm of hourly wage rate. It is worth noting that the estimate of the value of the human life is indirect and can be interpreted as the amount of money that a group of individuals is willing to pay for reducing the risk of death for one statistical life. The estimates obtained for people of various incomes and ages are comparable with international and Russian studies. The results show that the method underestimates the value of a statistical life for higher ages and it considers that the value increases with higher income level of respondents. Keywords: the valuation of the human life, the value of a statistical life, the willingness-to-pay approach, Russia