IDEAS home Printed from https://ideas.repec.org/a/aph/ajpbhl/10.2105-ajph.86.12.1723_7.html
   My bibliography  Save this article

Estimating the indirect cost of illness: An assessment of the forgone earnings approach

Author

Listed:
  • Glied, S.

Abstract

Objectives. This study attempted to assess (1) the accuracy of estimates of the indirect cost of illness and death computed with the human capital (forgone earnings) method and (2) the sensitivity of these estimates to key assumptions and parameters. Methods. The study used data from the annual Current Population Surveys of 1964 through 1988 to compare the earnings experience of cohorts of White men aged 18 through 65 with predictions made with the human capital method. The study then assessed the sources and magnitude of the observed differences. Results. Predictions of forgone earnings can be as much as 18% greater or 20% smaller than actual earnings, under identical assumptions, depending on the data used. While in most cases errors are quite small, alternative, equally plausible estimates of forgone earnings may differ by as much as 50%. Estimates differed mainly because of (1) the cross section chosen to make the predictions and (2) assumptions about future earnings growth. However, other factors, such as cohort size, also contributed to variation. Conclusions. Researchers and policymakers should be very careful in making and interpreting estimates of the indirect cost of illness and death.

Suggested Citation

  • Glied, S., 1996. "Estimating the indirect cost of illness: An assessment of the forgone earnings approach," American Journal of Public Health, American Public Health Association, vol. 86(12), pages 1723-1728.
  • Handle: RePEc:aph:ajpbhl:10.2105/ajph.86.12.1723_7
    DOI: 10.2105/AJPH.86.12.1723
    as

    Download full text from publisher

    File URL: http://hdl.handle.net/10.2105/AJPH.86.12.1723
    Download Restriction: no

    Citations

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


    Cited by:

    1. Tarricone, Rosanna, 2006. "Cost-of-illness analysis: What room in health economics?," Health Policy, Elsevier, vol. 77(1), pages 51-63, June.
    2. Allison Larg & John Moss, 2011. "Cost-of-Illness Studies," PharmacoEconomics, Springer, vol. 29(8), pages 653-671, August.

    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:aph:ajpbhl:10.2105/ajph.86.12.1723_7. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Christopher F Baum). General contact details of provider: https://www.apha.org .

    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.

    We have no references for this item. You can help adding them by using 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.

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

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.