Cost-Effectiveness Analysis

  • Magnus Johannesson
Part of the Developments in Health Economics and Public Policy book series (HEPP, volume 4)


This chapter is devoted to cost-effectiveness analysis. In a cost-effectiveness analysis the costs are measured in monetary terms and the health effects are measured in non-monetary terms, e.g. the number of life years gained. The ratio between costs and health effects is then estimated as e.g. the cost per gained life year. Cost-effectiveness analysis of health care programmes was developed in the medical field, as a response to the criticism about the use of the human-capital approach for valuing health changes in monetary terms, and the first study in the health care field by Klarman et al appeared in 1968.


Decision Rule Constant Return Health Care Programme Fixed Budget Effectiveness Unit 
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Copyright information

© Springer Science+Business Media Dordrecht 1996

Authors and Affiliations

  • Magnus Johannesson
    • 1
  1. 1.Stockholm School of EconomicsSweden

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