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Using discrete choice experiments to understand preferences for quality of life. Variance-scale heterogeneity matters

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  • Flynn, Terry Nicholas
  • Louviere, Jordan J.
  • Peters, Tim J.
  • Coast, Joanna
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    Abstract

    Health services researchers are increasingly using discrete choice experiments (DCEs) to model a latent variable, be it health, health-related quality of life or utility. Unfortunately it is not widely recognised that failure to model variance heterogeneity correctly leads to bias in the point estimates. This paper compares variance heterogeneity latent class models with traditional multinomial logistic (MNL) regression models. Using the ICECAP-O quality of life instrument which was designed to provide a set of preference-based general quality of life tariffs for the UK population aged 65+, it demonstrates that there is both mean and variance heterogeneity in preferences for quality of life, which covariate-adjusted MNL is incapable of separating. Two policy-relevant mean groups were found: one group that particularly disliked impairments to independence was dominated by females living alone (typically widows). Males who live alone (often widowers) did not display a preference for independence, but instead showed a strong aversion to social isolation, as did older people (of either sex) who lived with a spouse. Approximately 6-10% of respondents can be classified into a third group that often misunderstood the task. Having a qualification of any type and higher quality of life was associated with smaller random component variances. This illustrates how better understanding of random utility theory enables richer inferences to be drawn from discrete choice experiments. The methods have relevance for all health studies using discrete choice tasks to make inferences about a latent scale, particular QALY valuation exercises that use DCEs, best-worst scaling and ranking tasks.

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    Bibliographic Info

    Article provided by Elsevier in its journal Social Science & Medicine.

    Volume (Year): 70 (2010)
    Issue (Month): 12 (June)
    Pages: 1957-1965

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    Handle: RePEc:eee:socmed:v:70:y:2010:i:12:p:1957-1965

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    Related research

    Keywords: Discrete choice experiments Quality of life Older people Individual-level preferences Latent class analyses Variance heterogeneity models UK;

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    Cited by:
    1. N. Flynn, Terry & J. Peters, Tim & Coast, Joanna, 2013. "Quantifying response shift or adaptation effects in quality of life by synthesising best-worst scaling and discrete choice data," Journal of choice modelling, Elsevier, vol. 6(C), pages 34-43.
    2. Sivey, Peter & Scott, Anthony & Witt, Julia & Joyce, Catherine & Humphreys, John, 2012. "Junior doctors’ preferences for specialty choice," Journal of Health Economics, Elsevier, vol. 31(6), pages 813-823.
    3. Glenk, Klaus & Hall, Clare & Liebe, Ulf & Meyerhoff, Jürgen, 2012. "Preferences of Scotch malt whisky consumers for changes in pesticide use and origin of barley," Food Policy, Elsevier, vol. 37(6), pages 719-731.
    4. Marti, Joachim, 2012. "A best–worst scaling survey of adolescents' level of concern for health and non-health consequences of smoking," Social Science & Medicine, Elsevier, vol. 75(1), pages 87-97.
    5. Thiene, Mara & Meyerhoff, Jürgen & De Salvo, Maria, 2012. "Scale and taste heterogeneity for forest biodiversity: Models of serial nonparticipation and their effects," Journal of Forest Economics, Elsevier, vol. 18(4), pages 355-369.
    6. Anna Bartczak & Jürgen Meyerhoff, 2012. "Valuing the chances of survival of two distinct Eurasian lynx populations in Poland – do people want to keep doors open?," Working Papers 2012-14, Faculty of Economic Sciences, University of Warsaw.
    7. Alessandro Mengoni & Chiara Seghieri & Sabina Nuti, 2013. "The application of discrete choice experiments in health economics: a systematic review of the literature," Working Papers 201301, Scuola Superiore Sant'Anna of Pisa, Istituto di Management.

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