Dogs obviously have a real value to people. In America, dog owners love their pets a lot and the proof that they value them at a high price is that they spent more than 70 billion dollars on them last year ($20 billion for veterinary care, $16 billion on supplies, and $32 billion for food).
For most dog lovers, including me, dogs are viewed as part of the family. If someone asked me how much one of my dogs was worth in terms of dollars and cents my reply would be that he’s “priceless”. However, there are times when a monetary value for a dog must be determined, such as when a dog is wrongfully killed and a court is trying to determine penalties or reparations, or during a divorce proceeding when custody of the dog is to be decided with some compensation going to the losing spouse, or when governments decide how much they are willing to spend to guarantee the safety of dogs, as in passing and enforcing regulations and inspections for the safety of dog foods and medicines.
A team of researchers headed by Deven Carlson of the University of Oklahoma at Norman, Oklahoma, set out to determine the financial value of our pet dogs that could be used in such formal proceedings.
There is a long history of doing this sort of thing, at least for people, government analysts make calculations about how much human lives are worth compared with the cost of saving or prolonging them. This always brings up the question of what does it mean for a life to be valuable? The traditional human capital approach prices life in terms of productivity. This boils down to determining the value of a person based on that individual’s capacity to productively add to the economy. The idea is that when a person dies prematurely the value of their remaining life activity is lost to society. The economic value of a human life is, at minimum, made up of the amount of material support the deceased would have been able to provide to their family or estate in the form of the person’s projected future income minus their expenses.
This kind of calculation has some obvious problems. For instance, does this mean that the lives of housewives are worthless because they are not earning income? When using such a method of computing the value of a life, we find that the lives of men are typically worth more than the lives of women; the lives of the rich are worth more than lives of the poor; and both the very young and the very old are essentially economically worthless. For this reason, in recent years economists have switched to a more psychologically based measurement system using the assumption that things really only have economic value insofar as people are willing to pay for them. Thus the question becomes: “How much are people willing to pay for a life?”
This actually turns out to be a tough question to answer. After all, many people would pay everything they have (and more) to avoid certain death, and there is probably no amount of money most people would accept as adequate compensation for dying. Economists redefined the problem, converting it to how much people would be willing to pay to reduce the risk of dying today. Instead of attempting to value the price of whole lives, this method attempts to measure how much people are willing to pay for small changes in their chance of dying. In effect, they determine what you are willing to pay for each percentage point of risk reduction and then, using a lot of high-powered mathematics they infer the dollar value that society is placing on the remaining life of that person.
This is the tactic that this research team from Oklahoma used. They surveyed 4,682 dog owners and presented them with a scenario like this: Suppose that there was an outbreak of a form of canine influenza in which 12 percent of all of the dogs in the area are expected to contract the disease and die as a result. Now further suppose that there is a vaccine that would reduce the risk of the dog dying from 12 percent to only 2 percent. This vaccine would only be effective for a year. How much (from $5 to $3000) would the dog owner be willing to pay to get this treatment?
What the dog owner is telling us is how much he or she is willing to expend for the remaining portion of their dog’s life. The dog’s age and life expectancy, based on size, breed, and similar variables, are important for calculating the total value of that dog’s life. This is not easy and the economists on this team had to deal with an array of messy and complex equations to reach an answer.
After crunching the numbers, this research group came up with the valuation of a dog’s life being in the range of $5000 to $9000. These estimates do not take into account the emotional value of the dog to its family; however, the investigators took a stab at remedying this by gathering information on whether the dog was seen as a valued companion. When incorporated into their model this raises the value of a canine life by around $1000, meaning that the top limit on the monetary value of a dog would be about $10,000.
These value estimates are probably not going to please a lot of people. Some will argue that they are willing to pay much more than $10,000 to keep their beloved dog alive, while others might say that this valuation is way too high. After all, it’s just a dog. However, it is certainly something that can be used in official legal proceedings to avoid the kind of situation that occurred in a Pennsylvania court last year where a woman sued a neighbor who had killed her well-loved dog for “trespassing” on that neighbor’s lawn. The dog had been adopted from a shelter, and the woman had paid a $50 adoption fee. On the basis of this, the judge awarded her damages to the amount of $50 noting that that was the equivalent of the animal’s purchase price and it was the only evidence that he had as to the true value of that dog’s life.
Had this current data been available on the estimated value of a canine life, although the court judgment would still not have taken into account the pain and suffering of losing a pet who is a cherished family member, at least a more reasonable compensation for the woman, and a more significant penalty for the offender could have been reached.