Capabilities as Menus: A Non-Welfarist Basis for QALY Evaluation

Quality-Adjusted Life Years (QALYs) are the most widely-used measure of health in cost–effectiveness analysis and cost–benefit analysis. Within a welfarist framework QALYs are consistent with people’s preferences under stringent assumptions. Several authors have argued that QALYs are a valid measure of health within an extra-welfarist framework. This paper studies the applicability of QALYs within the best-known extra-welfarist framework, Sen’s capability approach. We propose a procedure to value capability sets and provide a foundation for QALYs within Sen’s capability approach. We show that, under appropriate conditions, the ranking of capabilities can be represented locally by a QALY measure and that a shadow price for QALYs can be defined.


Issue Date:
2011-10
Publication Type:
Working or Discussion Paper
PURL Identifier:
http://purl.umn.edu/151199
Total Pages:
33
JEL Codes:
D63; D70; I14
Series Statement:
Risk and Uncertainty Program
R11/5




 Record created 2017-04-01, last modified 2017-08-27

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