Should we build pedestrian walkways at every

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us safer are a good idea? Should we build pedestrian walkways at every intersection? Should we keep ourselves in bubbles to reduce risk of infectious disease?
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3 Economists’ perspective: There is an optimal level of risk that we should tolerate It is possible to have too much risk or too little risk Principle: Weigh costs against benefits How measure costs? Dollar value of what we have to give up to get more safety How measure benefits? Dollar value of what we’re willing to give up to get more safety Optimal level of safety: marginal benefit = marginal cost We know marginal cost of building another pedestrian bridge Need to put a dollar value on benefit of reducing risk to pedestrians Chapter 14: The Environment, Health, and Safety A. The optimal amount of safety B. Workplace safety regulation Example: controlling cotton dust exposure in the textile industry Byssinosis (“brown lung disease”): mild wheezing to severe respiratory problems
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4 Suppose that without worker protection, 1 in 12 textile workers would eventually develop byssinosis Suppose that it would cost the firm $2,000 per worker each year to improve ventilation system to reduce this risk Optimality principle: If it’s worth more than $2,000 per year to the worker to reduce the risk, improved ventilation is a good idea. If it’s worth less than $2,000 per year to the worker to reduce the risk, improved ventilation is not a good idea. 1. Outcome when there are no government regulations over worker safety Let’s say that nobody used to think there was any danger from working in a textile plant, and the wage paid textile workers used to be $25,000 per year.
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  • Spring '08
  • Kim
  • Economics, Taxation in the United States, Occupational safety and health, negative income tax

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