From a different angle: A novel approach to health valuation

Benjamin M. Craig and Mark Oppe

Social Science & Medicine, 2010, vol. 70, issue 2, 169-174

Abstract: The value of a health state is typically described relative to the value of an optimal state, specifically as a ratio ranging from unity (equal to optimal health) to negative infinity. Incorporating potentially infinite values is a challenging issue in the econometrics of health valuation. In this paper, we apply a directional statistics approach based on the assumption of wavering preference. Unlike ratio statistics, directional statistics are based on polar coordinates (angle, radius). The range of angles is bounded between 45 degrees (unity) and negative 90 degrees (i.e., negative infinity); therefore, mean angles are well behaved and negate the impetus behind arbitrary data manipulations. Using time trade-off (TTO) responses from the seminal Measurement and Valuation of Health study, we estimate 243 EQ-5D health state values by minimizing circular variance with and without radial weights. For states with published values greater than zero (i.e., better-than-death), the radially weighted estimates are nearly identical to the published values (Mean Absolute Difference 0.07; Lin's rho 0.94). For worse-than-death states, the estimates are substantially lower than the published values (Mean Absolute Difference 0.186; Lin's rho 0.576). For the worst EQ-5D state (33333), the published value is -0.59 and the directional estimate is -1.11. By taking a directional statistics approach, we circumvent problems inherent to ratio statistics and the systematic bias introduced by arbitrary data manipulations. The predictions suggest that published estimates overvalue severe states. This paper examines TTO responses; however, it may be extended to all forms of health valuation.

Keywords: Rank; Quality; of; life; EQ-5D; Time; trade-off (search for similar items in EconPapers)
Date: 2010
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2)

Downloads: (external link)
http://www.sciencedirect.com/science/article/pii/S0277-9536(09)00685-6
Full text for ScienceDirect subscribers only

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:eee:socmed:v:70:y:2010:i:2:p:169-174

Ordering information: This journal article can be ordered from
http://www.elsevier.com/wps/find/supportfaq.cws_home/regional
http://www.elsevier. ... _01_ooc_1&version=01

Access Statistics for this article

Social Science & Medicine is currently edited by Ichiro (I.) Kawachi and S.V. (S.V.) Subramanian

More articles in Social Science & Medicine from Elsevier
Bibliographic data for series maintained by Catherine Liu ().