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Getting used to it: The adaptive global utility model

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  • Bradford, W. David
  • Dolan, Paul

Abstract

This paper expands the standard model of utility maximization to endogenize the ubiquitous phenomenon of adaptation. We assume that total utility is an aggregate function of the utility associated with different domains of life, with relative weights that are optimized according to the effort that the individual expends on producing utility in each domain. Comparative statics from the general maximization problem demonstrate that the traditional Slutsky equation should incorporate an additional response term to account for adaptation processes. Our adaptive global utility maximization model can be used to explain responses to changes in health.

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  • Bradford, W. David & Dolan, Paul, 2010. "Getting used to it: The adaptive global utility model," Journal of Health Economics, Elsevier, vol. 29(6), pages 811-820, December.
    • Handle: RePEc:eee:jhecon:v:29:y:2010:i:6:p:811-820
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    References listed on IDEAS

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    1. The ‘Q’ in the QALY: are we fudging it?
      by Chris Sampson in The Academic Health Economists' Blog on 2013-09-30 10:30:34

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    6. Dolan, P. & Lordan, G., 2013. "Moving up and sliding down: An empirical assessment of the effect of social mobility on subjective wellbeing," Health, Econometrics and Data Group (HEDG) Working Papers 13/08, HEDG, c/o Department of Economics, University of York.
    7. Bussière, Clémence & Sirven, Nicolas & Tessier, Philippe, 2021. "Does ageing alter the contribution of health to subjective well-being?," Social Science & Medicine, Elsevier, vol. 268(C).
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    9. Paul Dolan & Richard Layard & Robert Metcalfe, 2011. "Measuring Subjective Wellbeing for Public Policy: Recommendations on Measures," CEP Reports 23, Centre for Economic Performance, LSE.
    10. Kanavos, Panos & Vandoros, Sotiris, 2023. "Road traffic mortality and economic uncertainty: Evidence from the United States," Social Science & Medicine, Elsevier, vol. 326(C).
    11. Ioana Ramia & Malina Voicu, 2022. "Life Satisfaction and Happiness Among Older Europeans: The Role of Active Ageing," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 160(2), pages 667-687, April.
    12. Antonella D’Agostino & Gaetano Grilli & Andrea Regoli, 2019. "The Determinants of Subjective Well-Being of Young Adults in Europe," Applied Research in Quality of Life, Springer;International Society for Quality-of-Life Studies, vol. 14(1), pages 85-112, March.
    13. Kyriopoulos, Ilias-Ioannis, 2023. "Economic uncertainty and cardiovascular disease mortality," LSE Research Online Documents on Economics 118452, London School of Economics and Political Science, LSE Library.
    14. Lee, Henry & Vlaev, Ivo & King, Dominic & Mayer, Erik & Darzi, Ara & Dolan, Paul, 2013. "Subjective well-being and the measurement of quality in healthcare," Social Science & Medicine, Elsevier, vol. 99(C), pages 27-34.
    15. Mario García Molina & Liliana Alejandra Chicaíza Becerra, 2013. "Felicidad:¿reemplazar o mejorar la utilidad subjetiva?," Revista Cuadernos de Economia, Universidad Nacional de Colombia, FCE, CID, December.
    16. Dolan, Paul & Galizzi, Matteo M., 2015. "Like ripples on a pond: Behavioral spillovers and their implications for research and policy," Journal of Economic Psychology, Elsevier, vol. 47(C), pages 1-16.
    17. Ichiro Kawachi & Ilias Kyriopoulos & Sotiris Vandoros, 2023. "Economic uncertainty and cardiovascular disease mortality," Health Economics, John Wiley & Sons, Ltd., vol. 32(7), pages 1550-1560, July.
    18. Stéphane Gregoir & Tristan‐Pierre Maury, 2013. "The Impact Of Social Housing On The Labour Market Status Of The Disabled," Health Economics, John Wiley & Sons, Ltd., vol. 22(9), pages 1124-1138, September.

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