IDEAS home Printed from https://ideas.repec.org/a/sae/medema/v41y2021i2p245-249.html
   My bibliography  Save this article

Are Discount Rates Too High? Population Health and Intergenerational Equity

Author

Listed:
  • R. Scott Braithwaite

    (Division of Comparative Effectiveness and Decision Science, Department of Population Health, NYU School of Medicine, New York, NY, USA)

  • Mark S. Roberts

    (Department of Health Policy and Management, University of Pittsburgh Public Health, Pittsburgh, PA, USA)

Abstract

Increasing attention is being paid to policy decisions in which shorter-term benefits may be eclipsed by longer-term harms, such as environmental damage. Health policy decisions have largely been spared this scrutiny, even though they too may contribute to longer-term harms. Any healthy population or society must sustain itself through reproduction, and therefore, transgenerational outcomes should be of intrinsic importance from a societal perspective. Yet, the discount rates typically employed in cost-effectiveness analyses have the effect of minimizing the importance of transgenerational health outcomes. We argue that, because cost-effectiveness analysis is based on foundational axioms of decision theory, it should value transgenerational outcomes consistently with those axioms, which require discount rates substantially lower than 3%. We discuss why such lower rates may not violate the Cretin-Keeler paradox.

Suggested Citation

  • R. Scott Braithwaite & Mark S. Roberts, 2021. "Are Discount Rates Too High? Population Health and Intergenerational Equity," Medical Decision Making, , vol. 41(2), pages 245-249, February.
    • Handle: RePEc:sae:medema:v:41:y:2021:i:2:p:245-249
    DOI: 10.1177/0272989X20979816
    as

    Download full text from publisher

    File URL: https://journals.sagepub.com/doi/10.1177/0272989X20979816
    Download Restriction: no
    File URL: https://libkey.io/10.1177/0272989X20979816?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    References listed on IDEAS

    as
    1. Mitchell, Paul Mark & Roberts, Tracy E. & Barton, Pelham M. & Coast, Joanna, 2015. "Assessing sufficient capability: A new approach to economic evaluation," Social Science & Medicine, Elsevier, vol. 139(C), pages 71-79.
    2. Mooney, Gavin, 2009. "Is it not time for health economists to rethink equity and access?," Health Economics, Policy and Law, Cambridge University Press, vol. 4(2), pages 209-221, April.
    3. Mooney, Gavin, 2005. "Communitarian claims and community capabilities: furthering priority setting?," Social Science & Medicine, Elsevier, vol. 60(2), pages 247-255, January.
    4. Emmett B. Keeler & Shan Cretin, 1983. "Discounting of Life-Saving and Other Nonmonetary Effects," Management Science, INFORMS, vol. 29(3), pages 300-306, March.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Clarke, Philip & Erreygers, Guido, 2020. "Defining and measuring health poverty," Social Science & Medicine, Elsevier, vol. 244(C).
    2. Kinghorn, Philip, 2019. "Using deliberative methods to establish a sufficient state of capability well-being for use in decision-making in the contexts of public health and social care," Social Science & Medicine, Elsevier, vol. 240(C).
    3. Thaddeus L Miller & Scott J N McNabb & Peter Hilsenrath & Jotam Pasipanodya & Stephen E Weis, 2009. "Personal and Societal Health Quality Lost to Tuberculosis," PLOS ONE, Public Library of Science, vol. 4(4), pages 1-7, April.
    4. Changli Zhu & Zhongfa Zhou & Guoxuan Ma & Linjiang Yin, 2022. "Spatial differentiation of the impact of transport accessibility on the multidimensional poverty of rural households in karst mountain areas," Environment, Development and Sustainability: A Multidisciplinary Approach to the Theory and Practice of Sustainable Development, Springer, vol. 24(3), pages 3863-3883, March.
    5. Coast, Joanna, 2018. "A history that goes hand in hand: Reflections on the development of health economics and the role played by Social Science & Medicine, 1967–2017," Social Science & Medicine, Elsevier, vol. 196(C), pages 227-232.
    6. Philippe Batifoulier & John Latsis & Jacques Merchiers, 2010. "Les priorités de la prise en charge financière des soins. Une approche par la philosophie du besoin," EconomiX Working Papers 2010-2, University of Paris Nanterre, EconomiX.
    7. Szeto, Kam Leong & Devlin, Nancy J., 1996. "The cost-effectiveness of mammography screening: evidence from a microsimulation model for New Zealand," Health Policy, Elsevier, vol. 38(2), pages 101-115, November.
    8. Hugh Gravelle & Dave Smith, 2001. "Discounting for health effects in cost–benefit and cost‐effectiveness analysis," Health Economics, John Wiley & Sons, Ltd., vol. 10(7), pages 587-599, October.
    9. Cairns, John, 2006. "Developments in discounting: With special reference to future health events," Resource and Energy Economics, Elsevier, vol. 28(3), pages 282-297, August.
    10. Anders Herlitz & David Horan, 2017. "A Model and Indicator of Aggregate Need Satisfaction for Capped Objectives and Weighting Schemes for Situations of Scarcity," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 133(2), pages 413-430, September.
    11. Garber, Alan M. & Phelps, Charles E., 1997. "Economic foundations of cost-effectiveness analysis," Journal of Health Economics, Elsevier, vol. 16(1), pages 1-31, February.
    12. Erik Nord, 2011. "Discounting future health benefits: the poverty of consistency arguments," Health Economics, John Wiley & Sons, Ltd., vol. 20(1), pages 16-26, January.
    13. Enrica Chiappero‐Martinetti & Paola Salardi & Francesco Scervini, 2019. "Estimating conversion rates: A new empirical strategy with an application to health care in Italy," Health Economics, John Wiley & Sons, Ltd., vol. 28(6), pages 748-764, June.
    14. Julia M. Puaschunder, 2024. "Age-Dependent Discounting and the Role of Imagination," RAIS Conference Proceedings 2022-2024 0418, Research Association for Interdisciplinary Studies.
    15. Arthur E. Attema & Werner B. F. Brouwer & Karl Claxton, 2018. "Discounting in Economic Evaluations," PharmacoEconomics, Springer, vol. 36(7), pages 745-758, July.
    16. Schoon, Rebecca & Chi, Chunhuei, 2022. "Integrating Citizens Juries and Discrete Choice Experiments: Methodological issues in the measurement of public values in healthcare priority setting," Social Science & Medicine, Elsevier, vol. 309(C).
    17. Bert van Wee, 2011. "Transport and Ethics," Books, Edward Elgar Publishing, number 14281, March.
    18. Petra Baji & Miklós Farkas & Ágota Dobos & Zsombor Zrubka & Levente Kovács & László Gulácsi & Márta Péntek, 2021. "Comparing the measurement properties of the ICECAP-A and ICECAP-O instruments in ages 50–70: a cross-sectional study on a representative sample of the Hungarian general population," The European Journal of Health Economics, Springer;Deutsche Gesellschaft für Gesundheitsökonomie (DGGÖ), vol. 22(9), pages 1453-1466, December.
    19. Nancy Thiry & Philippe Beutels & Pierre Damme & Eddy Doorslaer, 2003. "Economic Evaluations of Varicella Vaccination Programmes," PharmacoEconomics, Springer, vol. 21(1), pages 13-38, January.
    20. Brouwer, Werner B. F. & Koopmanschap, Marc A., 2000. "On the economic foundations of CEA. Ladies and gentlemen, take your positions!," Journal of Health Economics, Elsevier, vol. 19(4), pages 439-459, July.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:sae:medema:v:41:y:2021:i:2:p:245-249. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: SAGE Publications (email available below). General contact details of provider: .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.