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Public preferences for establishing nephrology facilities in Greenland: estimating willingness-to-pay using a discrete choice experiment

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  • Trine Kjær

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  • Mickael Bech
  • Christian Kronborg
  • Morten Mørkbak

Abstract

At present there are no nephrology facilities in Greenland. Greenlandic patients with renal failure needing dialysis thus have to travel to Denmark to obtain treatment. For patients in haemodialysis this necessitates a permanent residence in Denmark. Our study was aimed at examining Greenlanders’ preferences for establishing nephrology facilities in Greenland at Queen Ingrid’s Hospital in Nuuk, and to estimate the associated change in welfare. Preferences were elicited using a discrete choice experiment (DCE). A random sample of 500 individuals of the general population was sent a postal questionnaire in which they were asked to consider the trade-offs of establishing nephrology facilities in Greenland as opposed to the current situation. This involved trading off the benefits of having such facilities in their home country against the costs of the intervention. Besides including a payment attribute described in terms of incremental tax payment, the DCE included two interventions attributes related to (1) the organisation of labour, and (2) the physical settings of the patients. Respondents succeeded in answering the DCE despite cultural and linguistic disparity. We found that all the included attributes had a significant effect on respondents’ choices, and that respondents’ answers to the DCE were in keeping with their values as stated in the questionnaire. DCE data was analyzed using a random parameter logit model reparametrized in willingness-to-pay space. The results showed that establishing facilities in Greenland were preferred to the current treatment in Denmark. The welfare estimate from the DCE, at DKK 18.74 million, exceeds the estimated annual costs of establishing treatment facilities for patients with chronic renal failure. Given the estimated confidence interval this result seems robust. Establishing facilities in Greenland therefore would appear to be welfare-improving, deriving positive net benefits. Despite the relatively narrow policy focus, we believe that our findings provide some insight into individuals’ preferences for decentralization of public services and on citizens’ views of ‘self-governance’ that go beyond the case of Greenland. More generally, this paper illustrates how DCE can be applied successfully to developing countries with culturally, demographically, and geographically distinct features. Copyright Springer-Verlag 2013

Suggested Citation

  • Trine Kjær & Mickael Bech & Christian Kronborg & Morten Mørkbak, 2013. "Public preferences for establishing nephrology facilities in Greenland: estimating willingness-to-pay using a discrete choice experiment," The European Journal of Health Economics, Springer;Deutsche Gesellschaft für Gesundheitsökonomie (DGGÖ), vol. 14(5), pages 739-748, October.
  • Handle: RePEc:spr:eujhec:v:14:y:2013:i:5:p:739-748
    DOI: 10.1007/s10198-012-0418-3
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    References listed on IDEAS

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    1. Train,Kenneth E., 2009. "Discrete Choice Methods with Simulation," Cambridge Books, Cambridge University Press, number 9780521766555, December.
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    Cited by:

    1. Vikas Soekhai & Esther W. Bekker-Grob & Alan R. Ellis & Caroline M. Vass, 2019. "Discrete Choice Experiments in Health Economics: Past, Present and Future," PharmacoEconomics, Springer, vol. 37(2), pages 201-226, February.

    More about this item

    Keywords

    Discrete choice experiment; Willingness-to-pay space; Socital value; Publicly provided health care; Greenland; Nephrology facilities; D61; I38; O12;

    JEL classification:

    • D61 - Microeconomics - - Welfare Economics - - - Allocative Efficiency; Cost-Benefit Analysis
    • I38 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - Government Programs; Provision and Effects of Welfare Programs
    • O12 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Microeconomic Analyses of Economic Development

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