All Cancers Are not Created Equal: How Do Survival Prospects Affect the Willingness to Pay to Avoid Cancer?
Abstract
Regulatory impact analyses of proposed environmental, occupational, and consumer product safety regulations often rely on a metric known as the Value per Statistical Case of Cancer (VSCC), that is, the public's willingness to pay (WTP) for reductions in the risk of developing cancer. In this paper, we ask whether the VSCC depends on cancer survival prospects.
We develop a simple theoretical model that shows that under standard assumptions the VSCC is decreasing in the chance of surviving cancer. We empirically test this prediction by means of a stated preference survey, where we ask subjects aged 45-60 from the general population in the Czech Republic to report information about their WTP for reductions in the risk of getting cancer.
One half of the sample was told that, if they got cancer, the 5-year survival rate was 60 % (corresponding to the average survival chances across all types of cancer), while the other half was told that it was 75 %. Consistent with the theoretical model, we find that the VSCC is larger in the former group.
The ratio between the VSCC of the two groups is approximately equal to the ratio between the conditional cancer mortality risks implied by the survey's survival rates, suggesting that the VSCC is proportional to conditional cancer mortality. Our findings have important policy implications in the context of regulations that focus on pollutants linked to cancers with different chances of survival.