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Assessing and comparing costs: how robust are the bootstrap and methods based on asymptotic normality?

  • Anthony O'Hagan

    (Department of Probability and Statistics, University of Sheffield, UK)

  • John W. Stevens

    (AstraZeneca R&D Charnwood, UK)

Registered author(s):

    This article addresses and challenges some common perceptions in the statistical assessment of costs and cost-effectiveness in health economics. Cost data typically exhibit highly skew distributions. Two techniques whose validity does not depend on any specific form of underlying distribution are the bootstrap and methods based on asymptotic normality of sample means. These methods are generally thought to be appropriate for the analysis of cost data. We argue that, even when these methods are technically valid, they may often lead to inefficient and even misleading inferences. It is important to apply methods that recognise the skewness in cost data. We further demonstrate that it may also be important to incorporate relevant prior information in a Bayesian analysis. Copyright © 2002 John Wiley & Sons, Ltd.

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    File URL: http://hdl.handle.net/10.1002/hec.699
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    Article provided by John Wiley & Sons, Ltd. in its journal Health Economics.

    Volume (Year): 12 (2003)
    Issue (Month): 1 ()
    Pages: 33-49

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    Handle: RePEc:wly:hlthec:v:12:y:2003:i:1:p:33-49
    Contact details of provider: Web page: http://www3.interscience.wiley.com/cgi-bin/jhome/5749

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    1. Andrew H. Briggs, 1999. "A Bayesian approach to stochastic cost-effectiveness analysis," Health Economics, John Wiley & Sons, Ltd., vol. 8(3), pages 257-261.
    2. Andrew H. Briggs & David E. Wonderling & Christopher Z. Mooney, 1997. "Pulling cost-effectiveness analysis up by its bootstraps: A non-parametric approach to confidence interval estimation," Health Economics, John Wiley & Sons, Ltd., vol. 6(4), pages 327-340.
    3. Maiwenn J. Al & Ben A. Van Hout, 2000. "A Bayesian approach to economic analyses of clinical trials: the case of stenting versus balloon angioplasty," Health Economics, John Wiley & Sons, Ltd., vol. 9(7), pages 599-609.
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