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The Adjustment of Cost Measurement to Account for Learning

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  • Lars K. Langkilde
  • Jes Søgaard

Abstract

This note discusses the adjustment of cost measurement to account for learning. By learning is meant improvements in productive efficiency resulting from use of a (health) technology in routine practice. A recently proposed method is shown to be potentially misleading. Alternatively, it is suggested that the total cost is decomposed in treatment cost and learning cost. Furthermore, if there is uncertainty about the long‐run unit cost, learning will reveal the true cost. A method to adjust the learning cost for the value of this information is illustrated. © 1997 by John Wiley & Sons, Ltd.

Suggested Citation

  • Lars K. Langkilde & Jes Søgaard, 1997. "The Adjustment of Cost Measurement to Account for Learning," Health Economics, John Wiley & Sons, Ltd., vol. 6(1), pages 83-85, January.
    • Handle: RePEc:wly:hlthec:v:6:y:1997:i:1:p:83-85
    DOI: 10.1002/(SICI)1099-1050(199701)6:1<83::AID-HEC248>3.0.CO;2-U
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    References listed on IDEAS

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    1. Hirshleifer, J & Riley, John G, 1979. "The Analytics of Uncertainty and Information-An Expository Survey," Journal of Economic Literature, American Economic Association, vol. 17(4), pages 1375-1421, December.
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