Analysis of the value of statistical life in traffic accidents based on investments evaluation

Analysis of investments in transport is carried out in both the public and private sectors. The main objective of the development and implementation of projects in the public sector is to ensure the supply of public goods (safety, security, healthcare, various public services, etc.). This paper analyses these impacts in the public sector, specifically in air and road transport. Transpor sector defines safety as a key priority, but accidents do occur despite numerous sectoral preventive and mitigation measures. Loss of human lives is the most serious consequence of such accidents. Since the estimation of loss of human life is one of the key challenges for economists in conducting cost-benefit analysis, the paper discusses the methods used for such types of analysis. Evaluating the benefits and adverse outcomes of public sector projects often causes difficulties. While the expected benefit from avoided property damage caused by accidents can be calculated using available market prices, the benefits from reduced risk exposure and travel time do not have market prices. The paper emphasizes the monetary value of increasing safety, more precisely, the value of reducing the risk of mortality.