Time Preference for Health Gains Versus Health Losses

Abstract

Summary

The purpost of this research was to determine whether people devalue future heahh gains differently from future health losses. 108 subjects in various states of health were randomised to groups that rated their preference for a hypothetical health gain or loss of variable duration and delay, in the condition ofanhritis. Direction and duration of the hYPOthetical future health change had an interactive effect on time preference (p < 0.00 1). For the health gain, devaluation due to delay was consistent across durations. For the health loss, devaluation depended on duration; the long-duration loss was devalued with delay while the fleeting loss was inflated. These findings cast doubt on the assumptions of positive time preference and constant rate discounting that underlie the classical model of discounting. They provide suppon for a theory of intenemporal choice which posits that vivid, fleeting, future events engender ‘anticipation utility’ which attenuates positive time preference. OUT findings suggest that standard practices fOT discounting future health outcomes in economic evaluations of arthritis and possibly other conditions may need to be re-examined.