Valuing pain using the subjective well-being method

Thorhildur Ólafsdóttir*, Tinna Laufey Ásgeirsdóttir, Edward C. Norton

*Corresponding author for this work

Research output: Contribution to journalArticlepeer-review

5 Citations (Scopus)


Chronic pain clearly lowers utility, but valuing the reduction in utility is empirically challenging. Here, we use improvements over prior applications of the subjective well-being method to estimate the implied trade-off between pain and income using four waves of the Health and Retirement Study (2008-2014), a nationally representative survey on individuals age 50 and older. We model income with a flexible functional form, allowing the trade-off between pain and income to vary across income groups. We control for individual fixed effects in the life-satisfaction equations and instrument for income in some models. We find values for avoiding pain ranging between 56–145 USD per day. These results are lower than previously reported and suggest that the higher previous estimates may be heavily affected by the highest income level and confounded by endogeneity in the income variable. As expected, we find that the value of pain relief increases with pain severity.

Original languageEnglish
Article number100827
JournalEconomics and Human Biology
Publication statusPublished - May 2020

Bibliographical note

Publisher Copyright:
© 2019 Elsevier B.V.

Other keywords

  • Compensating variation
  • Pain
  • Subjective well-being method
  • Value
  • Willingness-To-Pay


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