Saving future lives. A comparison of three discounting models.
This paper compares three models of intertemporal choice concerning saving future lives: the constant discounting model, the proportional discounting model and the hyperbolic discounting model. The three models were investigated using data collected from the general public. Since these data have a multilevel structure, ordinary least-squares (OLS) estimates were supplemented by multilevel analysis. There is evidence in favour of the proportional (and to a lesser extent) the hyperbolic model over the constant discounting model. There is clear evidence for this data set that multilevel analysis is more appropriate than OLS.
Cairns
J A
JA
Health Economics Research Unit, University of Aberdeen, UK. j.cairns@abdn.ac.uk
van der Pol
M M
MM
D000328:Adult; D000368:Aged; D000369:Aged, 80 and over; D001294:Attitude to Health; D003362:Cost-Benefit Analysis / Q000379:methods*; D005260:Female; D006302:Health Services Research / Q000379:methods*; D006801:Humans; D016018:Least-Squares Analysis; D008019:Life Style; D008297:Male; D008875:Middle Aged; D017059:Models, Econometric; D015999:Multivariate Analysis; D012606:Scotland; D012959:Socioeconomic Factors; D026712:Value of Life