Economic valuation of health for environmental policy: Comparing alternative approaches. Introduction and overview

    Authors

    M. Dickie;J. List

    Comments

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    Abbreviated Journal Title

    Environ. Resour. Econ.

    Keywords

    benefit-cost analysis; cost-effectiveness analysis; environmental; policy; quality adjusted life years; regulatory analysis; value of a; statistical life; willingness to pay; COST-EFFECTIVENESS ANALYSIS; Economics; Environmental Studies

    Abstract

    Protecting human health is a primary goal of environmental policy and economic evaluation of health can help policy-makers judge the relative worth of alternative actions. Economists use two distinct approaches in normatively evaluating health. Whereas environmental economists use benefit-cost analysis supported by monetary valuation in terms of willingness-to-pay, health economists evaluate interventions based on cost-effectiveness or cost-utility analysis (CEA), using quality-adjusted life-years (QALY) or similar indexes. This paper provides background on the controversy about the relative merits of these approaches and introduces the remaining papers in the special issue. These papers (with one exception) were presented at a conference sponsored by the Department of Economics at the University of Central Florida with support from the US Environmental Protection Agency. Although CEA might not lead to substantially different implications for environmental policy than benefit-cost analysis, and QALY may provide a benefit transfer tool to fill gaps in the morbidity valuation literature, the papers in this issue raise serious concerns about the suitability of QALY-based CEA for environmental regulatory analysis. QALY does not in general appropriately represent individual preferences for health and CEA is neither independent of income distribution nor adequate to assess efficiency.

    Journal Title

    Environmental & Resource Economics

    Volume

    34

    Issue/Number

    3

    Publication Date

    1-1-2006

    Document Type

    Article

    Language

    English

    First Page

    339

    Last Page

    346

    WOS Identifier

    WOS:000239889400001

    ISSN

    0924-6460

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