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Willingness to pay for improved respiratory and cardiovascular health: a multiple-format, stated-preference approach

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Author Info

  • F. Reed Johnson

    (Triangle Economic Research, Durham, USA)

  • Melissa Ruby Banzhaf

    (University of North Carolina, Chapel Hill, USA)

  • William H. Desvousges

    (Triangle Economic Research, Durham, USA)

Registered author(s):

    Abstract

    This study uses stated-preference (SP) analysis to measure willingness to pay (WTP) to reduce acute episodes of respiratory and cardiovascular ill health. The SP survey employs a modified version of the health state descriptions used in the Quality of Well Being (QWB) Index. The four health state attributes are symptom, episode duration, activity restrictions and cost. Preferences are elicited using two different SP formats: graded-pair and discrete-choice. The different formats cause subjects to focus on different evaluation strategies. Combining two elicitation formats yields more valid and robust estimates than using only one approach. Estimates of indirect utility function parameters are obtained using advanced panel econometrics for each format separately and jointly. Socio-economic differences in health preferences are modelled by allowing the marginal utility of money relative to health attributes to vary across respondents. Because the joint model captures the combined preference information provided by both elicitation formats, these model estimates are used to calculate WTP. The results demonstrate the feasibility of estimating meaningful WTP values for policy-relevant respiratory and cardiac symptoms, even from subjects who never have personally experienced these conditions. Furthermore, because WTP estimates are for individual components of health improvements, estimates can be aggregated in various ways depending upon policy needs. Thus, using generic health attributes facilitates transferring WTP estimates for benefit-cost analysis of a variety of potential health interventions. Copyright © 2000 John Wiley & Sons, Ltd.

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    Bibliographic Info

    Article provided by John Wiley & Sons, Ltd. in its journal Health Economics.

    Volume (Year): 9 (2000)
    Issue (Month): 4 ()
    Pages: 295-317

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    Handle: RePEc:wly:hlthec:v:9:y:2000:i:4:p:295-317

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    Web page: http://www3.interscience.wiley.com/cgi-bin/jhome/5749

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    References

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    1. Johnson, F. Reed & Desvousges, William H., 1997. "Estimating Stated Preferences with Rated-Pair Data: Environmental, Health, and Employment Effects of Energy Programs," Journal of Environmental Economics and Management, Elsevier, vol. 34(1), pages 79-99, September.
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    Cited by:
    1. Windle, Jill & Rolfe, John & Brouwer, Roy, 2009. "Public values for improved water security for domestic and environmental use," 2009 Conference (53rd), February 11-13, 2009, Cairns, Australia 47627, Australian Agricultural and Resource Economics Society.
    2. Cameron, Trudy Ann & DeShazo, J.R., 2013. "Demand for health risk reductions," Journal of Environmental Economics and Management, Elsevier, vol. 65(1), pages 87-109.
    3. Brouwer, Roy & Bateman, Ian J., 2005. "Benefits transfer of willingness to pay estimates and functions for health-risk reductions: a cross-country study," Journal of Health Economics, Elsevier, vol. 24(3), pages 591-611, May.
    4. Fredrik Carlsson & Peter Martinsson, 2003. "Design techniques for stated preference methods in health economics," Health Economics, John Wiley & Sons, Ltd., vol. 12(4), pages 281-294.
    5. Kjaer, Trine & Gyrd-Hansen, Dorte, 2008. "Preference heterogeneity and choice of cardiac rehabilitation program: Results from a discrete choice experiment," Health Policy, Elsevier, vol. 85(1), pages 124-132, January.
    6. Emma McIntosh, 2006. "Using Discrete Choice Experiments within a Cost-Benefit Analysis Framework," PharmacoEconomics, Springer, vol. 24(9), pages 855-868, September.
    7. Alpizar, Francisco & Carlsson, Fredrik & Martinsson, Peter, 2001. "Using Choice Experiments for Non-Market Valuation," Working Papers in Economics 52, University of Gothenburg, Department of Economics.
    8. Hole, Arne Risa, 2008. "Modelling heterogeneity in patients' preferences for the attributes of a general practitioner appointment," Journal of Health Economics, Elsevier, vol. 27(4), pages 1078-1094, July.
    9. Kevin Boyle & Semra Özdemir, 2009. "Convergent Validity of Attribute-Based, Choice Questions in Stated-Preference Studies," Environmental & Resource Economics, European Association of Environmental and Resource Economists, vol. 42(2), pages 247-264, February.
    10. Regier, Dean A. & Ryan, Mandy & Phimister, Euan & Marra, Carlo A., 2009. "Bayesian and classical estimation of mixed logit: An application to genetic testing," Journal of Health Economics, Elsevier, vol. 28(3), pages 598-610, May.
    11. Meenakshi Bewtra & F. Johnson, 2013. "Assessing Patient Preferences for Treatment Options and Process of Care in Inflammatory Bowel Disease: A Critical Review of Quantitative Data," The Patient: Patient-Centered Outcomes Research, Springer, vol. 6(4), pages 241-255, December.
    12. McIntosh, E. & Ryan, M., 2002. "Using discrete choice experiments to derive welfare estimates for the provision of elective surgery: Implications of discontinuous preferences," Journal of Economic Psychology, Elsevier, vol. 23(3), pages 367-382, June.
    13. Falck-Zepeda, José & Kilkuwe, Enoch & Wesseler, Justus, 2008. "Introducing a genetically modified banana in Uganda: Social benefits, costs, and consumer perceptions," IFPRI discussion papers 767, International Food Policy Research Institute (IFPRI).
    14. George L. Van Houtven & Subhrendu K. Pattanayak & V. Kerry Smith, 2004. "Benefit Transfer Functions for Avoided Morbidity: A Preference Calibration Approach," NCEE Working Paper Series 200404, National Center for Environmental Economics, U.S. Environmental Protection Agency, revised Apr 2004.
    15. John Brazier & Donna Rowen & Yaling Yang & Aki Tsuchiya, 2012. "Comparison of health state utility values derived using time trade-off, rank and discrete choice data anchored on the full health-dead scale," The European Journal of Health Economics, Springer, vol. 13(5), pages 575-587, October.
    16. George Van Houtven & John Powers & Amber Jessup & Jui-Chen Yang, 2006. "Valuing avoided morbidity using meta-regression analysis: what can health status measures and QALYs tell us about WTP?," Health Economics, John Wiley & Sons, Ltd., vol. 15(8), pages 775-795.
    17. Bobinac, Ana & van Exel, N. Job A. & Rutten, Frans F.H. & Brouwer, Werner B.F., 2012. "GET MORE, PAY MORE? An elaborate test of construct validity of willingness to pay per QALY estimates obtained through contingent valuation," Journal of Health Economics, Elsevier, vol. 31(1), pages 158-168.

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