By Magnus Johannesson (auth.)
Most fiscal reviews of overall healthiness care programmes are actually expense effectiveness and cost-utility analyses. the matter with those equipment is that their theoretical foundations are doubtful. This has ended in confusion approximately how to find the prices and well-being results and the way to interpret the result of those experiences. within the environmental and site visitors security fields it really is as an alternative universal to hold out conventional cost-bene:fit analyses of wellbeing and fitness bettering programmes. This awesome distinction in how wellbeing and fitness programmes are assessed in several fields used to be the unique motivation for penning this ebook. the purpose of the ebook is to tty and supply a coherent framework inside cost-bene:fit research and welfare economics for the various equipment of financial overview within the wellbeing and fitness care box. The publication is written in an simply available demeanour and a number of other examples of purposes of the several tools are supplied. it truly is my desire that it'll be helpful either for educating reasons and as a advisor for practitioners within the box. Glenn C. Blomquist, John D. Graham, wealthy O'Conor and 4 nameless referees supplied worthy reviews on earlier types of the manuscript. i'd additionally wish to convey my gratitude to the subsequent folks for aiding me to arrange the manuscript: Carl-Magnus Berglund, Carin Blanksvard, Ann Brown, and Ziad Obeid.
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Additional info for Theory and Methods of Economic Evaluation of Health Care
The figure shows the utility function with respect to income in the health states full health (H*) and arthritis (HA). The individual has a 50% chance of being in each health state and the income in both 37 health states is YO. A drug is introduced that will cure the individual of arthritis. If the individual is in the arthritis state the WTP would be the maximum income the individual is willing to give up to be in full health, which is equal to YO-Y" in the figure. e. half of the distance between YO and Y").
1 Private WTP We will start with the simplest possible model to define the private WIP for a health change. Assume that the utility of an individual depends on the consumption of private (non-health) goods, and the health of the individual. This leads to the following utility function: U=U(C,H) (1) In equation 1, C is the consumption of private non-health goods and H is the health of the individual. The health of the individual is here assumed to be exogenous to the individual, which means that we do not include the possibility that the individual can produce health.
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