Decisions about Health Behavioral Experiments in Health with Applications to Understand and Improve Health State Valuation

Abstract

How do individuals and societies make such decisions about health in practice, and does economic research provide the right tools to inform and study such decision-making? In his dissertation, Stefan Lipman tries to answer these questions. \nIn economics, decisions about health are typically studied assuming they are made rationally. However, over the past decades the traditional economic view of rationality has been suggested to be highly unrealistic. \nAs most work challenging this view is based on financial decision-making, in the first part of his dissertation, Lipman extends some of these findings to health in a series of behavioral experiments. For example, he shows that many individuals are loss averse for health, i.e. they are more sensitive to health losses than to equally sized health gains. However, large differences exist between individuals\xe2\x80\x99 decision-making tendencies. Policy makers aiming to improve decisions about health should, therefore, consider policies tailored to each individual. In his dissertation, Lipman explores such tailoring for exercise behavior. \nSocietal decisions about health are often informed by comparing the costs and benefits of some health intervention. Assessing these health benefits, however, requires some quantitative measure to express health in and adequate methods to facilitate such quantification. The second part of Lipman\xe2\x80\x99s dissertation explores why two methods used for this valuation of health, typically yield different results. As in the first part of the dissertation, it appears that rather than assuming rationality, taking into account differences in individual decision-making could resolve the differences between method