How to measure health costs induced by air pollution?

This paper reviews the different methods that have been used for measuring health costs. Since the cost of illness method captures only the "social cost" (medical expenses and loss of income), we recommend that it be used in conjunction with contingent valuation because the latter yields the "private cost" (suffering, inconvenience, restricted activity). We illustrate this point by carrying out a case study on the valuation of minor illness due to air pollution in Strasbourg, France. We find that the private cost represents on average about 50% (between 15 and 150%) of the total cost: the private cost is an important component and must not be overlooked in the allocation of public resources for the protection of health.