Health Outcomes Measurement Quiz

Health Outcomes Measurement

• QALY (Quality-Adjusted Life Year): A method for measuring health outcomes, introduced by Weinstein et al. (2009). Criticized by Ward (2023) for potential discrimination against older individuals, though Feng et al. (2024) found no empirical evidence of such bias. Risk aversion is a more realistic approach.
• DALY (Disability Adjusted Life Year): Introduced by Murray (1994), used to measure disease burden. Also criticized for potential elder discrimination by Anand and Hanson (1997). Feng et al. (2020) found similar results regarding older individuals as the QALY method.
• GRA-QALY (Growing Risk Aversion-QALY): Introduced by Lakdawalla and Phelps (2020), aims to improve evaluations of health prospects. Reported to be more equitable for drug pricing by Li et al. (2024), placing more value on improved health when facing bleaker possibilities.
• Significant Difference in Preferences: Weyler and Gandjour (2011) observed significant preferences differences between individuals affected by illness and the general community, while Klimchak et al. (2024) presented a case study of rejected free disability treatment.

Private Insurance

• Adverse Selection: Rothchild and Stiglitz (1976) identified adverse selection as a potential issue in private insurance.
• Moral Hazard: Pauly (1974) introduced moral hazard effects in private insurance. Wong et al. (2011) found empirical evidence for both adverse selection and moral hazard, but the effects were less severe than predicted primarily by adverse selection.

Capability Approach

• Theory of Justice: Sen (2000) developed a theory of justice based on the capability approach, which outperforms libertarian and Rawlsian theories. It is ethically individualistic, but not ontologically.
• Accessibility Adjustments: Robeyns (2005) highlighted utilitarianism's failure to account for accessibility adjustments.
• Vague and Democratic Deliberation: Nussbaum (2003) acknowledged the vagueness of the capability approach and noted how democratic deliberation could lead to undesirable outcomes.
• List of Good Life Elements: Nussbaum (2003) proposed a list of 10 elements representing a good life.
• Context Dependence: Sen (2004a) emphasized the need for context-dependent lists of good life elements.
• Indifferentiable from Utility: Gasper (2002) observed that the capability approach can become indistinguishable from the utility approach in practice.
• Stratified Model: Jackson (2005) proposed a stratified model of justice, incorporating individual capabilities and social structures.
• Opportunity, Not Procedure: Sen (2004b) acknowledged that his theory focuses on opportunity aspects of justice, excluding procedural aspects.

Pensions

• Overlapping Generations Model: Kanganovich and Zilcha (2012) derived pension equations using an overlapping generations model.
• Sweden's PAYG System: Lundberg (2024) analyzed Sweden's PAYG (pay-as-you-go) pension system, revealing initial favoritism towards the original generation, but subsequent reforms effectively mitigated intergenerational inequalities.
• Ageing Population Impact: Febero and Cadraso (2007) noted the decline in labor supply due to aging populations, potentially impacting profits and returns.
• Savings and Growth: Most economists disagree that savings invariably promote economic growth.
• Funding System and Savings Relationship: Mackenzie et al. (1997) found a weak relationship between the pension funding system and savings.
• Volatile Returns: Piketty (2013) highlighted the risks associated with volatile investment returns during transitions, stating that a whole generation might not receive returns.

Optimal Taxation

• Laffer Curve: Laffer (2004) introduced the Laffer curve model.
• UK & US Tax Cuts (1980s): Cooper (2012) noted the use of the Laffer curve to justify tax cuts in the UK and US during the 1980s.
• Low Taxable Income Elasticity (Denmark): Kleven and Schultz (2014) documented low taxable income elasticity in Denmark, underscoring the need for broad tax bases and extensive information reporting.
• Tax Audit Funding Returns: Boning et al. (2023) found disproportionately high returns from increased tax audit funding in the US.
• Meltzer and Richard (1981) Effect: Trabandt and Uhlig (2011) estimated the Laffer curve peak revenue. Kang and Seo (2023) found empirical support for this model to be weak, especially in captured democracies.
• Optimal Tax Rate: Saez (2001) proposed an optimal tax rate ranging from approximately 43% to 65%.

Equity vs Efficiency

• Trade-off in Policy-Making: Barry (1965) introduced the concept of a trade-off between equity and efficiency in policy decisions.
• Equity as a Core Principle: Rawls (1971) argued that equity is central to his theory of justice.
• Least Cost Efficiency: Le Grand (1990) viewed efficiency as least cost, making it a secondary objective, so no inherent trade-off may exist.
• Equity Ignoring Abilities: Varian (1974) noted limitations in equity definitions that ignore individual abilities.
• Equity as Envy: Varian (1974) also examined equity as defined by envy and its possible trade-off with Pareto optimality.
• Utility Proxied by Income: Gasper (2002) observed the common practice of proxying utility by income.
• Leaky Bucket Metaphor: Okun (1975) used the "leaky bucket" analogy to illustrate the relationship between equity and efficiency.
• Growth Equity Trade Off: Anderson and Maiborn (2019) presented evidence of a potential trade-off between growth and equity.
• Lower Development Levels: Dollar et al. (2016) found no evidence of a trade-off at lower development levels.
• Public Service Synergy: Liu (2012) suggested synergies from public service expenditures.