The economics in 'Global Health 2035': a sensitivity analysis of the value of a life year estimates

Angela Chang, James Hammitt, S.c Resch and Lisa Robinson ()

No 17-756, TSE Working Papers from Toulouse School of Economics (TSE)

Abstract: In “Global health 2035: a world converging within a generation,” The Lancet Commission on Investing in Health (CIH) adds the value of increased life expectancy to the value of growth in gross domestic product (GDP) when assessing national well-being. To value changes in life expectancy, the CIH relies on several strong assumptions to bridge gaps in the empirical research. It finds that the value of a life year (VLY) averages 2.3 times GDP per capita for low- and middle-income countries (LMICs) assuming the changes in life expectancy they experienced from 2000 to 2011 are permanent. We investigate the sensitivity of this estimate to the underlying assumptions, including the effects of income, age, and life expectancy, and the sequencing of the calculations. We find that reasonable alternative assumptions regarding the effects of income, age, and life expectancy may reduce the VLY estimates to 0.2 to 2.1 times GDP per capita for LMICs. Removing the reduction for young children increases the VLY, while reversing the sequencing of the calculations reduces the VLY

Date: 2017-01
New Economics Papers: this item is included in nep-hea
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