IDEAS home Printed from https://ideas.repec.org/a/wly/hlthec/v17y2008i7p863-875.html
   My bibliography  Save this article

Aggregation rules for cost–benefit analysis: a health economics perspective

Author

Listed:
  • Josephine Borghi

Abstract

Few willingness‐to‐pay (WTP) studies in the health sector have used their results within a cost–benefit analysis (CBA), an essential step to informing resource allocation decisions. This paper provides an overview of aggregation methods, reviews current evidence of practice in the health sector, and presents estimates of the total economic value of a women's group programme to improve mother and newborn health using different aggregation rules. A contingent valuation survey was conducted with 93 women's group members, 70 female non‐members and 33 husbands. Aggregation was conducted with and without the values of non‐users, and with different units of aggregation. The unadjusted mean, median and a weighted mean transfer were used to aggregate values. Equity weights were introduced to adjust WTP for income. Total WTP more than doubled when the values of husbands were added to that of women, and increased over 10‐fold when the values of women who were not members of the group were added. The inclusion of non‐use values, and the unit of aggregation, had the greatest effect on results. Researchers must reach agreement on the most acceptable method of aggregating WTP values to promote the use of WTP in resource allocation decisions in the health sector. Copyright © 2007 John Wiley & Sons, Ltd.

Suggested Citation

  • Josephine Borghi, 2008. "Aggregation rules for cost–benefit analysis: a health economics perspective," Health Economics, John Wiley & Sons, Ltd., vol. 17(7), pages 863-875, July.
    • Handle: RePEc:wly:hlthec:v:17:y:2008:i:7:p:863-875
    DOI: 10.1002/hec.1304
    as

    Download full text from publisher

    File URL: https://doi.org/10.1002/hec.1304
    Download Restriction: no
    File URL: https://libkey.io/10.1002/hec.1304?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    References listed on IDEAS

    as
    1. Amiel,Yoram & Cowell,Frank, 1999. "Thinking about Inequality," Cambridge Books, Cambridge University Press, number 9780521466967.
    2. Kurth, A. & Weaver, M. & Lockhart, D. & Bielinski, L., 2004. "The benefit of health insurance coverage of contraceptives in a population-based sample," American Journal of Public Health, American Public Health Association, vol. 94(8), pages 1330-1332.
    3. Dong, Hengjin & Kouyate, Bocar & Snow, Rachel & Mugisha, Frederick & Sauerborn, Rainer, 2003. "Gender's effect on willingness-to-pay for community-based insurance in Burkina Faso," Health Policy, Elsevier, vol. 64(2), pages 153-162, May.
    4. Nick Hanley & Mandy Ryan & Robert Wright, 2003. "Estimating the monetary value of health care: lessons from environmental economics," Health Economics, John Wiley & Sons, Ltd., vol. 12(1), pages 3-16, January.
    5. John B. Loomis, 1987. "Expanding Contingent Value Sample Estimates to Aggregate Benefit Estimates: Current Practices and Proposed Solutions," Land Economics, University of Wisconsin Press, vol. 63(4), pages 396-402.
    6. Jones-Lee, M W, 1992. "Paternalistic Altruism and the Value of Statistical Life," Economic Journal, Royal Economic Society, vol. 102(410), pages 80-90, January.
    7. Samuel Fankhauser & Richard Tol & DAVID Pearce, 1997. "The Aggregation of Climate Change Damages: a Welfare Theoretic Approach," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 10(3), pages 249-266, October.
    8. Andreoni, James, 1990. "Impure Altruism and Donations to Public Goods: A Theory of Warm-Glow Giving?," Economic Journal, Royal Economic Society, vol. 100(401), pages 464-477, June.
    9. Macmillan, Douglas C. & Philip, Lorna & Hanley, Nick & Alvarez-Farizo, Begona, 2002. "Valuing the non-market benefits of wild goose conservation: a comparison of interview and group based approaches," Ecological Economics, Elsevier, vol. 43(1), pages 49-59, November.
    10. Richard D. Smith, 2003. "Construction of the contingent valuation market in health care:a critical assessment," Health Economics, John Wiley & Sons, Ltd., vol. 12(8), pages 609-628, August.
    11. Jacobsson, Fredric & Carstensen, John & Borgquist, Lars, 2005. "Caring externalities in health economic evaluation: how are they related to severity of illness?," Health Policy, Elsevier, vol. 73(2), pages 172-182, August.
    12. Cam Donaldson & Stephen Birch & Amiram Gafni, 2002. "The distribution problem in economic evaluation: income and the valuation of costs and consequences of health care programmes," Health Economics, John Wiley & Sons, Ltd., vol. 11(1), pages 55-70, January.
    13. Mark Morrison, 2000. "Aggregation Biases in Stated Preference Studies," Australian Economic Papers, Wiley Blackwell, vol. 39(2), pages 215-230, June.
    14. Morrison, Mark, 2000. "Aggregation Biases in Stated Preference Studies," Australian Economic Papers, Wiley Blackwell, vol. 39(2), pages 215-230, June.
    15. Borghi, Josephine & Shrestha, Daya L. & Shrestha, Deepa & Jan, Stephen, 2007. "Using focus groups to develop contingent valuation scenarios--A case study of women's groups in rural Nepal," Social Science & Medicine, Elsevier, vol. 64(3), pages 531-542, February.
    16. Nunes, Paulo A. L. D. & Schokkaert, Erik, 2003. "Identifying the warm glow effect in contingent valuation," Journal of Environmental Economics and Management, Elsevier, vol. 45(2), pages 231-245, March.
    17. Paul Dolan & Aki Tsuchiya, 2011. "Determining the parameters in a social welfare function using stated preference data: an application to health," Applied Economics, Taylor & Francis Journals, vol. 43(18), pages 2241-2250.
    18. Onwujekwe, Obinna & Chima, Reginald & Shu, Elvis & Nwagbo, Douglas & Akpala, Cyril & Okonkwo, Paul, 2002. "Altruistic willingness to pay in community-based sales of insecticide-treated nets exists in Nigeria," Social Science & Medicine, Elsevier, vol. 54(4), pages 519-527, February.
    19. Jones-Lee, M W, 1991. "Altruism and the Value of Other People's Safety," Journal of Risk and Uncertainty, Springer, vol. 4(2), pages 213-219, April.
    20. Burton A. Weisbrod, 1964. "Collective-Consumption Services of Individual-Consumption Goods," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 78(3), pages 471-477.
    21. Ian J. Bateman & Richard T. Carson & Brett Day & Michael Hanemann & Nick Hanley & Tannis Hett & Michael Jones-Lee & Graham Loomes, 2002. "Economic Valuation with Stated Preference Techniques," Books, Edward Elgar Publishing, number 2639.
    22. Jan Abel Olsen & Richard D. Smith, 2001. "Theory versus practice: a review of ‘willingness‐to‐pay’ in health and health care," Health Economics, John Wiley & Sons, Ltd., vol. 10(1), pages 39-52, January.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Martín-Fernández, Jesús & Gómez-Gascón, Tomás & Oliva-Moreno, Juan & del Cura-González, María Isabel & Domínguez-Bidagor, Julia & Beamud-Lagos, Milagros & Sanz-Cuesta, Teresa, 2010. "Perception of the economic value of primary care services: A willingness to pay study," Health Policy, Elsevier, vol. 94(3), pages 266-272, March.
    2. Giulia Greco & Paula Lorgelly & Inthira Yamabhai, 2016. "Outcomes in Economic Evaluations of Public Health Interventions in Low‐ and Middle‐Income Countries: Health, Capabilities and Subjective Wellbeing," Health Economics, John Wiley & Sons, Ltd., vol. 25(S1), pages 83-94, February.
    3. Jesús Martín-Fernández & Mª Isabel del Cura-González & Gemma Rodríguez-Martínez & Gloria Ariza-Cardiel & Javier Zamora & Tomás Gómez-Gascón & Elena Polentinos-Castro & Francisco Javier Pérez-Rivas & J, 2013. "Economic Valuation of Health Care Services in Public Health Systems: A Study about Willingness to Pay (WTP) for Nursing Consultations," PLOS ONE, Public Library of Science, vol. 8(4), pages 1-9, April.
    4. Jesús Martín-Fernández & Gloria Ariza-Cardiel & Luz Mª Peña-Longobardo & Elena Polentinos-Castro & Juan Oliva-Moreno & Ana Isabel Gil-Lacruz & Héctor Medina-Palomino & Isabel del Cura-González, 2017. "“Gaining or losing”: The importance of the perspective in primary care health services valuation," PLOS ONE, Public Library of Science, vol. 12(12), pages 1-14, December.
    5. Pantea Marius & Gligor Delia, 2013. "Estimating Qalys In The Western Region Of Romania €" The Case With Intervention," Annals of Faculty of Economics, University of Oradea, Faculty of Economics, vol. 1(1), pages 290-299, July.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Borghi, Josephine & Jan, Stephen, 2008. "Measuring the benefits of health promotion programmes: Application of the contingent valuation method," Health Policy, Elsevier, vol. 87(2), pages 235-248, August.
    2. Hurley, Jeremiah & Mentzakis, Emmanouil, 2013. "Health-related externalities: Evidence from a choice experiment," Journal of Health Economics, Elsevier, vol. 32(4), pages 671-681.
    3. Schwarzinger, Michaël & Carrat, Fabrice & Luchini, Stéphane, 2009. ""If you have the flu symptoms, your asymptomatic spouse may better answer the willingness-to-pay question": Evidence from a double-bounded dichotomous choice model with heterogeneous anchori," Journal of Health Economics, Elsevier, vol. 28(4), pages 873-884, July.
    4. Jeremiah Hurley & Emmanouil Mentzakis, 2011. "Existence and Magnitude of Health-related Externalities: Evidence from a Choice Experiment," Department of Economics Working Papers 2011-01, McMaster University.
    5. Richard D. Smith, 2007. "The role of 'reference goods' in contingent valuation: should we help respondents to 'construct' their willingness to pay?," Health Economics, John Wiley & Sons, Ltd., vol. 16(12), pages 1319-1332.
    6. Olivier Chanel & Stéphane Luchini & Alain Paraponaris & Christel Protière & Jean-Christophe Vergnaud, 2004. "Les consentements à payer pour des programmes de prévention sanitaire incluent-ils de l'altruisme ?. Enseignements d'une enquête sur la fièvre Q," Revue économique, Presses de Sciences-Po, vol. 55(5), pages 923-945.
    7. Richard D. Smith, 2007. "The role of ‘reference goods’ in contingent valuation: should we help respondents to ‘construct’ their willingness to pay?," Health Economics, John Wiley & Sons, Ltd., vol. 16(12), pages 1319-1332, December.
    8. Olsen, Jan Abel & Kidholm, Kristian & Donaldson, Cam & Shackley, Phil, 2004. "Willingness to pay for public health care: a comparison of two approaches," Health Policy, Elsevier, vol. 70(2), pages 217-228, November.
    9. Michaël Schwarzinger & Fabrice Carrat & Stéphane Luchini, 2009. ""If you have the flu symptoms, your asymptomatic spouse may better answer the willingness-to-pay question". Evidence from a double-bounded dichotomous choice model with heterogeneous anchori," Post-Print inserm-00636179, HAL.
    10. David Whynes & Emma Frew & Jane Wolstenholme, 2005. "Willingness-to-Pay and Demand Curves: A Comparison of Results Obtained Using Different Elicitation Formats," International Journal of Health Economics and Management, Springer, vol. 5(4), pages 369-386, December.
    11. Robert J. Johnston & Kevin J. Boyle & Wiktor (Vic) Adamowicz & Jeff Bennett & Roy Brouwer & Trudy Ann Cameron & W. Michael Hanemann & Nick Hanley & Mandy Ryan & Riccardo Scarpa & Roger Tourangeau & Ch, 2017. "Contemporary Guidance for Stated Preference Studies," Journal of the Association of Environmental and Resource Economists, University of Chicago Press, vol. 4(2), pages 319-405.
    12. Smith, Richard D., 2005. "Sensitivity to scale in contingent valuation: the importance of the budget constraint," Journal of Health Economics, Elsevier, vol. 24(3), pages 515-529, May.
    13. Marc Fleurbaey & Stéphane Luchini & Christophe Muller & Erik Schokkaert, 2013. "Equivalent Income And Fair Evaluation Of Health Care," Health Economics, John Wiley & Sons, Ltd., vol. 22(6), pages 711-729, June.
    14. Franz Hackl & Gerald J. Pruckner, 2005. "Warm glow, free‐riding and vehicle neutrality in a health‐related contingent valuation study," Health Economics, John Wiley & Sons, Ltd., vol. 14(3), pages 293-306, March.
    15. Menon Martina & Perali Federico & Veronesi Marcella, 2017. "“Leaving No Child Behind:” Preferences for Social Inclusion and Altruism," The B.E. Journal of Economic Analysis & Policy, De Gruyter, vol. 17(3), pages 1-19, July.
    16. Smith, Richard D. & Richardson, Jeff, 2005. "Can we estimate the `social' value of a QALY?: Four core issues to resolve," Health Policy, Elsevier, vol. 74(1), pages 77-84, September.
    17. Choi, Andy S. & Ritchie, Brent W. & Papandrea, Franco & Bennett, Jeff, 2010. "Economic valuation of cultural heritage sites: A choice modeling approach," Tourism Management, Elsevier, vol. 31(2), pages 213-220.
    18. repec:cup:judgdm:v:2:y:2007:i::p:96-106 is not listed on IDEAS
    19. Per-Olov Johansson, 1992. "Altruism in cost-benefit analysis," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 2(6), pages 605-613, November.
    20. Henrik Andersson & Nicolas Treich, 2011. "The Value of a Statistical Life," Chapters, in: André de Palma & Robin Lindsey & Emile Quinet & Roger Vickerman (ed.), A Handbook of Transport Economics, chapter 17, Edward Elgar Publishing.
    21. Laura J. Damschroder & Peter A. Ubel & Jason Riis & Dylan M. Smith, 2007. "An alternative approach for eliciting willingness-to-pay: A randomized Internet trial," Judgment and Decision Making, Society for Judgment and Decision Making, vol. 2, pages 96-106, April.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:wly:hlthec:v:17:y:2008:i:7:p:863-875. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Wiley Content Delivery (email available below). General contact details of provider: http://www3.interscience.wiley.com/cgi-bin/jhome/5749 .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.