Tests of Utility Independence When Health Varies over Time
AbstractIn the conventional QALY model, people's preferences are assumed to satisfy utility independence. When health varies over time, utility independence implies that the value attached to a health state is independent of the health state that arise before or after it. In this paper we set out to test the extent to which utility independence is undermined by sequence and duration effects. Two separate studies were conducted involving a total of 155 respondents. In study one, we conducted 5 tests of utility independence using a standard gamble question. Three of the tests of utility independence were repeated in study two after randomisation was introduced in order to take account of possible ordering effects. Utility independence holds in the majority of cases examined here and so our work generally supports the use of utility independence to derive more tractable models.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
Bibliographic InfoPaper provided by Queen Mary, University of London, School of Economics and Finance in its series Working Papers with number 596.
Date of creation: May 2007
Date of revision:
Utility independence; QALY;
Find related papers by JEL classification:
- H5 - Public Economics - - National Government Expenditures and Related Policies
- I10 - Health, Education, and Welfare - - Health - - - General
This paper has been announced in the following NEP Reports:
- NEP-ALL-2007-05-19 (All new papers)
- NEP-HEA-2007-05-19 (Health Economics)
- NEP-UPT-2007-05-19 (Utility Models & Prospect Theory)
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Doctor, Jason N. & Bleichrodt, Han & Miyamoto, John & Temkin, Nancy R. & Dikmen, Sureyya, 2004. "A new and more robust test of QALYs," Journal of Health Economics, Elsevier, vol. 23(2), pages 353-367, March.
- Daniel Kahneman & Robert Sugden, 2005. "Experienced Utility as a Standard of Policy Evaluation," Environmental & Resource Economics, European Association of Environmental and Resource Economists, vol. 32(1), pages 161-181, 09.
- Guerrero, Ana M. & Herrero, Carmen, 2005. "A semi-separable utility function for health profiles," Journal of Health Economics, Elsevier, vol. 24(1), pages 33-54, January.
- Bleichrodt, Han & Quiggin, John, 1997. "Characterizing QALYs under a General Rank Dependent Utility Model," Journal of Risk and Uncertainty, Springer, vol. 15(2), pages 151-65, November.
- Jens Leth Hougaard & Juan D. Moreno-Ternero & Lars Peter Østerdal, 2012.
"A New Axiomatic Approach to the Evaluation of Population Health,"
MSAP Working Paper Series
07_2012, University of Copenhagen, Department of Food and Resource Economics.
- Jens Leth Hougaard & Juan D. Moreno-Ternero & Lars Peter Østerdal, 2011. "A new axiomatic approach to the evaluation of population health," Discussion Papers 11-24, University of Copenhagen. Department of Economics.
- HOUGAARD, Jens L. & MORENO-TERNERO, Juan & OSTERDAL, Lars P., 2012. "A new axiomatic approach to the evaluation of population health," CORE Discussion Papers 2012007, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
- Hougaard, Jens Leth & Moreno-Ternero, Juan D. & Østerdal, Lars Peter, 2012. "A new axiomatic approach to the evalution of population health," Health Economics Papers 2012:3, COHERE - Centre of Health Economics Research, University of Southern Denmark.
- Jens L. Hougaard & Juan D. Moreno-Ternero & Lars P. Osterdal, 2012. "A new axiomatic approach to the evaluation of population health," Working Papers 12.08, Universidad Pablo de Olavide, Department of Economics.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Nick Vriend).
If references are entirely missing, you can add them using this form.