Thirteenth International Conference on Interdisciplinary Social Sciences

Abstract

The escalation in violence in recent years resulting from the Mexican government’s war on drug trafficking has caused a large and unprecedented increase in workplace fatality risk for workers in Mexico. We exploit this increase in violence to estimate a compensating differential for fatality risk using panel data constructed from a national employment and occupation survey. We also provide estimates of the value of a statistical life (VSL) in Mexico. Our results imply a VSL for a nationally representative sample of Mexican workers that is well below the range of estimates typically found in developed countries, which is consistent with the notion that health and safety are normal goods.