Risk Attitude and Time Preference in Health

Amiram Gafni and George W. Torrance
Additional contact information
Amiram Gafni: Faculty of Management, Tel Aviv University, Tel Aviv, Israel
George W. Torrance: Faculty of Business / Faculty of Health Sciences, McMaster University, Hamilton, Ontario, Canada L8S 4M4

Management Science, 1984, vol. 30, issue 4, 440-451

Abstract: Risk attitude and time preference are well-known and distinct concepts in the study of individuals' preferences for goods such as money. This paper reviews and explores the application of these concepts to the field of health. A mathematical model is presented, both in a general form and in an exponential form, which relates an individual's risk attitude in health to three effects---a quantity effect, a gambling effect and a time preference effect. It is shown that the overall risk attitude, as measured by its direction and magnitude, is merely the sum of the individual effects, as measured by their directions and magnitudes. Measurement methods are presented which can be used in a given situation to determine which effects are operating, in what directions and with what magnitudes. A new measurement procedure based on the temporary palliation of a chronic condition is described as a method of obtaining an individual's time preference pattern for health.

Keywords: health care; utility/preference measurement (search for similar items in EconPapers)
Date: 1984
References: Add references at CitEc
Citations: View citations in EconPapers (44)

Downloads: (external link)
http://dx.doi.org/10.1287/mnsc.30.4.440 (application/pdf)

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:inm:ormnsc:v:30:y:1984:i:4:p:440-451

Access Statistics for this article

More articles in Management Science from INFORMS Contact information at EDIRC.
Bibliographic data for series maintained by Chris Asher ().