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Building the cube

Building the cube. Marc Fleurbaey. Deconstructing the cube. Marc Fleurbaey. Good news and bad news. Bad news: there is no simple micro criterion to decide the shape of the cube; it all depends on wider impacts on the population

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Building the cube

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  1. Building the cube Marc Fleurbaey

  2. Deconstructingthe cube Marc Fleurbaey

  3. Good news and bad news • Bad news: thereis no simple micro criterion to decide the shape of the cube; it all depends on wider impacts on the population • Good news: we know how to evaluate the situation of a population (or at least there are someways)

  4. Weneed a SWF (Adler) • Health affects well-beingdirectly, but alsoindirectly via capacities: focusing on healtheffectsexclusively misses manybenefits • Rate of coverage affects poor-richaccess • Population covered affects health and consumption • Services coveredtoo • Mode of fundingshouldbe part of the project • The health budget affects consumption of othergoods

  5. Solidarity more thaninsurance(Adler, Voorhoeve) • In general, the distribution of individualhealth and consumptionisknown ex ante, no macro-social risk (except for longevity and pandemics) • The health system affects the distribution of health and consumption evaluatewith a SWF • Peace of mind due to insurancedoesimprovepeople’s situation, evenfrom the ex post standpoint • A perfectinsurance model might not provide a good guideline (Dworkin): People don’twant to insurewhenharmreducestheir marginal utility (frequentwithhealth?)

  6. Individualwell-being • 3 dimensions of individualwell-being: longevity, health, consumption • There is no way to trade-off these dimensions withoutrelying on population values and preferences • QALYs and similarmeasures are too restrictive (additive form) • How to elicitpreferences? 1) Behavior; 2) Statedpreferences; 3) Life satisfaction

  7. Preferences • Hard questions about: • Lowlongevity (isitbetter to die as an infant than as a child?) • Severe pain: incommensurablyworse? • Unusualtrade-offs: not toocomplex, but too simple • Wouldyouprefer to live longer but poorer (by how much)? • Wouldyouprefer a lowerhealth but more income? • What about preferenceheterogeneity? • Equivalence approach (HealthEconomics 2013 –joint with S. Luchini, C. Muller, E. Schokkaert)

  8. SWF • Somepriority to the worse-off • Degree of priority hard to specify • Sometimes the Rawlsianabsolutepriorityis ok (taxation) • For healthpolicythisisdubious • Change in population? Probably a good start to study a cohort • Ignores new livescreated (not clearwhat the impact on total human population is)

  9. Relation to CEA • CEA: • Unidimensional measure of longevity-health gains • Can be weighted (O. Norheim: longevity-health weights) • Fixed cut-off or fixed budget • SWF (CBA): • More democratic measure of benefits • More end-state measure of benefits • Weighted by social priority (poor) • Includes non-health benefits (may be essential to convince) • Trade-off between longevity-health benefits and other “consumptions”

  10. Conclusion: What are the difficulties? Elicitingpreferencesonlongevity-health-consumption Predicting the impact of expandedhealth care on population longevity-health-consumption (with feedback effects on growth)

  11. Can one do without the SWF? A. Wagstaff: Provide the health care people need At a costtheycanafford Focus on most urgent priorities (build-up process) CEA can help but why not go beyond?

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