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Cost-effectiveness analysis and its application for policy evaluation for medicine or public health


  • Yasushi Ohkusa


  • Tamie Sugawara


In comparison to the policy for other field, the policy for medicine and public health is to consider the value of life or the value of the quality of life. Quality of life is very well known as a concept of QOL. Also, Quality Adjusted Life of Years (QALY) which integrates QOL over life of years is widely used as a measure of the value of life. Cost-effectiveness analysis for medicine and public health adopts two approaches to incorporate value of QOL or QALY. We summarize those advantage and disadvantage briefly at first. Unfortunately, cost-effectiveness analysis has not been committed and operated as an official rule for the method of policy evaluation for medicine or public health in Japan, yet. Thus we show some researches about it which examines ex post or ex ante policy evaluation using cost-effectiveness analysis. In other countries, some political decision making in medicine or public health is based on cost-effectiveness analysis. However, the pressure of the financial deficit will require more accountability about evidence. Therefore, cost-effectiveness analysis must be more important even in political decision making in medicine or public health in Japan.

Suggested Citation

  • Yasushi Ohkusa & Tamie Sugawara, 2006. "Cost-effectiveness analysis and its application for policy evaluation for medicine or public health," Development Economics Working Papers 22354, East Asian Bureau of Economic Research.
  • Handle: RePEc:eab:develo:22354

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    References listed on IDEAS

    1. Tara Maddala & Kathryn A. Phillips & F. Reed Johnson, 2003. "An experiment on simplifying conjoint analysis designs for measuring preferences," Health Economics, John Wiley & Sons, Ltd., vol. 12(12), pages 1035-1047.
    2. Harry Telser & Peter Zweifel, 2002. "Measuring willingness-to-pay for risk reduction: an application of conjoint analysis," Health Economics, John Wiley & Sons, Ltd., vol. 11(2), pages 129-139.
    3. van Doorslaer, Eddy & Wagstaff, Adam & Bleichrodt, Han & Calonge, Samuel & Gerdtham, Ulf-G. & Gerfin, Michael & Geurts, Jose & Gross, Lorna & Hakkinen, Unto & Leu, Robert E., 1997. "Income-related inequalities in health: some international comparisons," Journal of Health Economics, Elsevier, vol. 16(1), pages 93-112, February.
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    More about this item


    medicine; public health; Quality of Life; public health; cost-effectiveness; Japan;

    JEL classification:

    • I18 - Health, Education, and Welfare - - Health - - - Government Policy; Regulation; Public Health
    • I10 - Health, Education, and Welfare - - Health - - - General


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