Government agencies use the statistical value of a life to weigh the benefits of a regulation against the costs to the public - the same people who would benefit from the regulation. Would a new safety requirement for cars be worth it if it added $500 to the price of every new car? They might use the value of a life to help answer that question.
This is very different than the recall story, because in that scenario there is no cost to the public at all, only to the corporation. When government agencies make rules about product recalls, they do not try to balance the benefit to the public against the cost to the recalling company, that would be insane.
See the DoT's own guidance here: https://www.transportation.gov/sites/dot.gov/files/2021-03/D.... They do not at all use this figure in the same way that a profit-driven entity does.
> The benefit of preventing a fatality is measured by what is conventionally called the Value of a Statistical Life, defined as the additional cost that individuals would be willing to bear for improvements in safety (that is, reductions in risks) that, in the aggregate, reduce the expected number of fatalities by one.
The word "individuals" is very important in this definition.
This is very different than the recall story, because in that scenario there is no cost to the public at all, only to the corporation. When government agencies make rules about product recalls, they do not try to balance the benefit to the public against the cost to the recalling company, that would be insane.
See the DoT's own guidance here: https://www.transportation.gov/sites/dot.gov/files/2021-03/D.... They do not at all use this figure in the same way that a profit-driven entity does.
> The benefit of preventing a fatality is measured by what is conventionally called the Value of a Statistical Life, defined as the additional cost that individuals would be willing to bear for improvements in safety (that is, reductions in risks) that, in the aggregate, reduce the expected number of fatalities by one.
The word "individuals" is very important in this definition.