A Cost–Benefit Approach
Chapter 37: Commodification: Everything is Seen as a Commodity to be Bought and Sold
Non-economists (and many health economists) take the view that they are content to use cost minimization and cost-effectiveness analysis to try to evaluate HIV/AIDS interventions, but they balk at the use of CBA for the same purposes. Using monetary values for inputs to determine costs is fine, but using values for outputs to determine benefits is not fine (in fact, it is unacceptable). In Part III, when we looked at these alternative evaluation methods, we already pointed out that putting monetary values on inputs and outputs involves the same set of ethical and social considerations. So if one accepts one set of valuations (on the costs side) one should, logically, accept the other set of valuations (on the benefits side). But, now let us examine in detail exactly what the values are that underlie the estimation of benefits in CBA. Best practice in CBA is to use willingness to pay to obtain the monetary values for outputs and inputs. When we went through the theory behind WTP we drew the analogy with hamburgers. If people actually pay $4 for a hamburger then they must value the hamburgers at least $4 or else they would not have been willing to pay that amount for them. It is at this point that you can imagine the critics of CBA saying: “That is exactly the problem with CBA. It is treating health care and HIV/AIDS interventions as if they were commodities like hamburgers! How can you use the idea of WTP to value...
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