Cost-effectiveness of Sick Leave Policies for Health Care Workers with Influenza-like Illness, Brazil, 2009

We describe the effect of influenza-like illness (ILI) during the outbreak of pandemic (H1N1) 2009 on health care worker (HCW) absenteeism and compare the effectiveness and cost of 2 sick leave policies for HCWs with suspected influenza. We assessed initial 2-day sick leaves plus reassessment until the HOW was asymptomatic (2-day + reassessment policy), and initial 7-day sick leaves (7-day policy). Sick leaves peaked in August 2009: 3% of the workforce received leave for ILI. Costs during May October reached R$798,051.87 (approximate to US $443,362). The 7-day policy led to a higher monthly rate of sick leave days per 100 HCWs than did the 2-day + reassessment policy (8.72 vs. 3.47 days/100 HCWs; p<0.0001) and resulted in higher costs (US $609 vs. US $1,128 per HCW on leave). ILI affected HCW absenteeism. The 7-day policy was more costly and not more effective in preventing transmission to patients than the 2-day + reassessment policy.

Cost-benefit analysis of alternative forms of hedgerow intercropping in the Philippine uplands

Considerable resources have been expended promoting hedgerow intercropping with shrub legumes to farmers in the Philippine uplands. Despite the resources committed to research and extension, persistent adoption by farmers has been limited to low cost versions of the technology including natural vegetation and grass strips. In this paper, cost-benefit analysis is used to compare the economic returns from traditional open-field maize farming with returns from intercropping maize between leguminous shrub hedgerows, natural vegetation strips and grass strips. An erosion/productivity model, Soil Changes Under Agroforestry, was used to predict the effect of erosion on maize yields. Key informant surveys with experienced maize farmers were used to derive production budgets for the alternative farming methods. The economic incentives revealed by the cost-benefit analysis help to explain the adoption of maize farming methods in the Philippine uplands. Open-field farming without hedgerows has been by far the most popular method of maize production, often with two or more fields cropped in rotation. There is little persistent adoption of hedgerow intercropping with shrub legumes because sustained maize yields are not realised rapidly enough to compensate farmers for establishment and maintenance costs. Natural vegetation and grass strips are more attractive to farmers because of lower establishment costs, and provide intermediate steps to adoption. Rural finance, commodity pricing and agrarian reform policies influence the incentives for maize farmers in the Philippine uplands to adopt and maintain hedgerow intercropping.

Accuracy and cost- and time-effectiveness of digital clip versus videotape interpretation of echocardiograms in patients with valvular disease

Background. Although digital and videotaped images are known to be comparable for the evaluation of left ventricular function, their relative accuracy for assessment of more complex anatomy is unclear. We sought to compare reading time, storage costs, and concordance of video and digital interpretations across multiple observers and sites. Methods. One hundred one patients with valvular (90 mitral, 48 aortic, 80 tricuspid) disease were selected prospectively, and studies were stored according to video and standardized digital protocols. The same reviewer interpreted video and digital images independently and at different times with the use of a standard report form to evaluate 40 items (eg, severity of stenosis or regurgitation, leaflet thickening, and calcification) as normal or mildly, moderately, or severely abnormal Concordance between modalities was expressed at kappa Major discordance (difference of >1 level of severity) was ascribed to the modality that gave the lesser severity. CD-ROM was used to store digital data (20:1 lossy compression), and super-VHS video-tape was used to store video data The reading time and storage costs for each modality were compared Results. Measured parameters were highly concordant (ejection fraction was 52% +/- 13% by both). Major discordance was rare, and lesser values were reported with digital rather than video interpretation in the categories of aortic and mitral valve thicken ing (1% to 2%) and severity of mitral regurgitation (2%). Digital reading time was 6.8 +/- 2.4 minutes, 38% shorter than with video (11.0 +/- 3.0, range 8 to 22 minutes, P < .001). Compressed digital studies had an average size of 60 <plus/minus> 14 megabytes (range 26 to 96 megabytes). Storage cost for video was A$0.62 per patient (18 studies per tape, total cost A$11.20), compared with A$0.31 per patient for digital storage (8 studies per CD-ROM, total cost A$2.50). Conclusion. Digital and video interpretation were highly concordant; in the few cases of major discordance, the digital scores were lower, perhaps reflecting undersampling. Use of additional views and longer clips may be indicated to minimize discordance with video in patients with complex problems. Digital interpretation offers a significant reduction in reading times and the cost of archiving.

Scenario Planning and Evaluation of Pricing Strategies in the Portuguese Bulk LPG Market

Portugal has the largest LPG (Liquefied Petroleum Gas) share of primary energy demand in the EU (about 5%). Due to the increasing international cost of LPG in the last years and the high price sensitivity of the consumers the preference for substitute energy sources in new and existing consumers has been increasing. To select the kind of energy, some consumer estimate and compare the total costs while others follow agents (equipment sellers) recommendations. It takes time to build agents perception about the most advantageous source of energy, which is seen as an important resource that drives client resource accumulation and retention. Marketing strategies have to take into consideration some market dynamic effects derived from the accumulation and depletion of these resources. A simple system dynamics model was built, combined with Economic Value Added framework, to evaluate some pricing strategies under different scenarios of LPG international cost.

Scenario Planning and Evaluation of Pricing Strategies in the Portuguese Bulk LPG Market

Portugal has the largest LPG (Liquefied Petroleum Gas) share of primary energy demand in the EU (about 5%). Due to the increasing international cost of LPG in the last years and the high price sensitivity of the consumers the preference for substitute energy sources in new and existing consumers has been increasing. To select the kind of energy, some consumer estimate and compare the total costs while others follow agents (equipment sellers) recommendations. It takes time to build agents perception about the most advantageous source of energy, which is seen as an important resource that drives client resource accumulation and retention. Marketing strategies have to take into consideration some market dynamic effects derived from the accumulation and depletion of these resources. A simple system dynamics model was built, combined with Economic Value Added framework, to evaluate some pricing strategies under different scenarios of LPG international cost.

Partial utility-driven scheduling for flexible SLA and pricing arbitration in clouds

Cloud SLAs compensate customers with credits when average availability drops below certain levels. This is too inflexible because consumers lose non-measurable amounts of performance being only compensated later, in next charging cycles. We propose to schedule virtual machines (VMs), driven by range-based non-linear reductions of utility, different for classes of users and across different ranges of resource allocations: partial utility. This customer-defined metric, allows providers transferring resources between VMs in meaningful and economically efficient ways. We define a comprehensive cost model incorporating partial utility given by clients to a certain level of degradation, when VMs are allocated in overcommitted environments (Public, Private, Community Clouds). CloudSim was extended to support our scheduling model. Several simulation scenarios with synthetic and real workloads are presented, using datacenters with different dimensions regarding the number of servers and computational capacity. We show the partial utility-driven driven scheduling allows more VMs to be allocated. It brings benefits to providers, regarding revenue and resource utilization, allowing for more revenue per resource allocated and scaling well with the size of datacenters when comparing with an utility-oblivious redistribution of resources. Regarding clients, their workloads’ execution time is also improved, by incorporating an SLA-based redistribution of their VM’s computational power.

On international cost-sharing of pharmaceutical R&D

Ramsey pricing has been proposed in the pharmaceutical industry as a principle to price discriminate among markets while allowing to recover the (fixed) R&D cost. However, such analyses neglect the presence of insurance or the fund raising costs for most of drug reimbursement. By incorporating these new elements, we aim at providing some building blocks towards an economic theory incorporating Ramsey pricing and insurance coverage. We show how coinsurance affects the optimal prices to pay for the R&D investment. We also show that under certain conditions, there is no strategic incentive by governments to set coinsurance rates in order to shift the financial burden of R&D. This will have important implications to the application of Ramsey pricing principles to pharmaceutical products across countries.

Economic analysis in health care regulation : three essays

ABSTRACT - It is the purpose of the present thesis to emphasize, through a series of examples, the need and value of appropriate pre-analysis of the impact of health care regulation. Specifically, the thesis presents three papers on the theme of regulation in different aspects of health care provision and financing. The first two consist of economic analyses of the impact of health care regulation and the third comprises the creation of an instrument for supporting economic analysis of health care regulation, namely in the field of evaluation of health care programs. The first paper develops a model of health plan competition and pricing in order to understand the dynamics of health plan entry and exit in the presence of switching costs and alternative health premium payment systems. We build an explicit model of death spirals, in which profitmaximizing competing health plans find it optimal to adopt a pattern of increasing relative prices culminating in health plan exit. We find the steady-state numerical solution for the price sequence and the plan’s optimal length of life through simulation and do some comparative statics. This allows us to show that using risk adjusted premiums and imposing price floors are effective at reducing death spirals and switching costs, while having employees pay a fixed share of the premium enhances death spirals and increases switching costs. Price regulation of pharmaceuticals is one of the cost control measures adopted by the Portuguese government, as in many European countries. When such regulation decreases the products’ real price over time, it may create an incentive for product turnover. Using panel data for the period of 1997 through 2003 on drug packages sold in Portuguese pharmacies, the second paper addresses the question of whether price control policies create an incentive for product withdrawal. Our work builds the product survival literature by accounting for unobservable product characteristics and heterogeneity among consumers when constructing quality, price control and competition indexes. These indexes are then used as covariates in a Cox proportional hazard model. We find that, indeed, price control measures increase the probability of exit, and that such effect is not verified in OTC market where no such price regulation measures exist. We also find quality to have a significant positive impact on product survival. In the third paper, we develop a microsimulation discrete events model (MSDEM) for costeffectiveness analysis of Human Immunodeficiency Virus treatment, simulating individual paths from antiretroviral therapy (ART) initiation to death. Four driving forces determine the course of events: CD4+ cell count, viral load resistance and adherence. A novel feature of the model with respect to the previous MSDEMs is that distributions of time to event depend on individuals’ characteristics and past history. Time to event was modeled using parametric survival analysis. Events modeled include: viral suppression, regimen switch due virological failure, regimen switch due to other reasons, resistance development, hospitalization, AIDS events, and death. Disease progression is structured according to therapy lines and the model is parameterized with cohort Portuguese observational data. An application of the model is presented comparing the cost-effectiveness ART initiation with two nucleoside analogue reverse transcriptase inhibitors (NRTI) plus one non-nucleoside reverse transcriptase inhibitor(NNRTI) to two NRTI plus boosted protease inhibitor (PI/r) in HIV- 1 infected individuals. We find 2NRTI+NNRTI to be a dominant strategy. Results predicted by the model reproduce those of the data used for parameterization and are in line with those published in the literature.

The system of Transfer Pricing in a multinational

Transfer prices are used by the majority of firms worldwide when intermediate products or services are transferred within the same organization. These prices are reported as revenue for the selling entity (division, unit, department etc.) and as cost for the buying entity. Nevertheless, transfer prices lead to many disputes among managers in the same organization as transfer prices influence the performance of their entities. In cross-border transactions, transfer prices can be used by firms to reduce corporate taxes and thus, increase total firm profits. In order to fight against this firms’ practice, tax authorities require firms to establish a transfer pricing system in accordance with OECD1 Transfer Pricing Guidelines.

Price competition under cost uncertainty: A laboratory analysis

We study the relation between the number of firms and price-cost margins under price competition with uncertainty about competitors' costs. We present results of an experiment in which two, three and four identical firms repeatedly interact in this environment. In line with the theoretical prediction, market prices decrease with the number of firms, but on average stay above marginal costs. Pricing is less aggressive in duopolies than in triopolies and tetrapolies. However, independently from the number of firms, pricing is more aggressive than in the theoretical equilibrium. Both the absolute and the relative surpluses increase with the number of firms. Total surplus is close to the equilibrium level, since enhanced consumer surplus through lower prices is counteracted by occasional displacements of the most efficient firm in production.

A Retail benchmarking approach to eficient two-way access pricing

We study a retail benchmarking approach to determine access prices for interconnected networks. Instead of considering fixed access charges as in the existing literature, we study access pricing rules that determine the access price that network i pays to network j as a linear function of the marginal costs and the retail prices set by both networks. In the case of competition in linear prices, we show that there is a unique linear rule that implements the Ramsey outcome as the unique equilibrium, independently of the underlying demand conditions. In the case of competition in two-part tariffs, we consider a class of access pricing rules, similar to the optimal one under linear prices but based on average retail prices. We show that firms choose the variable price equal to the marginal cost under this class of rules. Therefore, the regulator (or the competition authority) can choose one among the rules to pursue additional objectives such as consumer surplus, network covera.

Experimental evidence of a sunk–cost paradox: a study of pricing behavior in Bertrand–Edgeworth duopoly

A well–known implication of microeconomic theory is that sunk costs should have no effect on decision making. We test this hypothesis with a human–subjects experiment. Students recruited from graduate business courses, with an average of over six years of work experience, played the role of firms in a repeated price–setting duopoly game in which both firms had identical capacity constraints and costs, including a sunk cost that varied across experimental sessions over six different values. We find, contrary to the prediction of microeconomic theory, that subjects’ pricing decisions show sizable differences across treatments. The effect of the sunk cost is non–monotonic: as it increases from low to medium levels, average prices decrease, but as it increases from medium to high levels, average prices increase. These effects are not apparent initially, but develop quickly and persist throughout the game. Cachon and Camerer’s (1996) loss avoidance is consistent with both effects, while cost–based pricing predicts only the latter effect, and is inconsistent with the former.

The Inflation Bias under Calvo and Rotemberg Pricing.

New Keynesian models rely heavily on two workhorse models of nominal inertia - price contracts of random duration (Calvo, 1983) and price adjustment costs (Rotemberg, 1982) - to generate a meaningful role for monetary policy. These alternative descriptions of price stickiness are often used interchangeably since, to a first order of approximation they imply an isomorphic Phillips curve and, if the steady-state is efficient, identical objectives for the policy maker and as a result in an LQ framework, the same policy conclusions. In this paper we compute time-consistent optimal monetary policy in bench-mark New Keynesian models containing each form of price stickiness. Using global solution techniques we find that the inflation bias problem under Calvo contracts is significantly greater than under Rotemberg pricing, despite the fact that the former typically significant exhibits far greater welfare costs of inflation. The rates of inflation observed under this policy are non-trivial and suggest that the model can comfortably generate the rates of inflation at which the problematic issues highlighted in the trend inflation literature emerge, as well as the movements in trend inflation emphasized in empirical studies of the evolution of inflation. Finally, we consider the response to cost push shocks across both models and find these can also be significantly different. The choice of which form of nominal inertia to adopt is not innocuous.

Essays in equilibrium asset pricing

This thesis consists of four essays in equilibrium asset pricing. The main topic is investors' heterogeneity: I investigates the equilibrium implications for the financial markets when investors have different attitudes toward risk. The first chapter studies why expected risk and remuneration on the aggregate market are negatively related, even if intuition and standard theory suggest a positive relation. I show that the negative trade-off can obtain in equilibrium if investors' beliefs about economic fundamentals are procyclically biased and the market Sharpe ratio is countercyclical. I verify that such conditions hold in the real markets and I find empirical support for the risk-return dynamics predicted by the model. The second chapter consists of two essays. The first essay studies how het¬erogeneity in risk preferences interacts with other sources of heterogeneity and how this affects asset prices in equilibrium. Using perceived macroeconomic un¬certainty as source of heterogeneity, the model helps to explain some patterns of financial returns, even if heterogeneity is small as suggested by survey data. The second essay determines conditions such that equilibrium prices have analytical solutions when investors have heterogeneous risk attitudes and macroeconomic fundamentals feature latent uncertainty. This approach provides additional in-sights to the previous literature where models require numerical solutions. The third chapter studies why equity claims (i.e. assets paying a single future dividend) feature premia and risk decreasing with the horizon, even if standard models imply the opposite shape. I show that labor relations helps to explain the puzzle. When workers have bargaining power to exploit partial income insurance within the firm, wages are smoother and dividends are riskier than in a standard economy. Distributional risk among workers and shareholders provides a rationale to the equity short-term risk, which leads to downward sloping term structures of premia and risk for equity claim. Résumé Cette thèse se compose de quatre essais dans l'évaluation des actifs d'équilibre. Le sujet principal est l'hétérogénéité des investisseurs: J'étudie les implications d'équilibre pour les marchés financiers où les investisseurs ont des attitudes différentes face au risque. Le première chapitre étudie pourquoi attendus risque et la rémunération sur le marché global sont liées négativement, même si l'intuition et la théorie standard suggèrent une relation positive. Je montre que le compromis négatif peut obtenir en équilibre si les croyances des investisseurs sur les fondamentaux économiques sont procyclique biaisées et le ratio de Sharpe du marché est anticyclique. Je vérifier que ces conditions sont réalisées dans les marchés réels et je trouve un appui empirique à la dynamique risque-rendement prédites par le modèle. Le deuxième chapitre se compose de deux essais. Le première essai étudie com¬ment hétérogénéité dans les préférences de risque inter agit avec d'autres sources d'hétérogénéité et comment cela affecte les prix des actifs en équilibre. Utili¬sation de l'incertitude macroéconomique perù comme source d'hétérogénéité, le modèle permet d'expliquer certaines tendances de rendements financiers, même si l'hétérogénéité est faible comme suggéré par les données d'enquête. Le deuxième essai détermine des conditions telles que les prix d'équilibre disposer de solutions analytiques lorsque les investisseurs ont des attitudes des risques hétérogènes et les fondamentaux macroéconomiques disposent d'incertitude latente. Cette approche fournit un éclairage supplémentaire à la littérature antérieure où les modèles nécessitent des solutions numériques. Le troisième chapitre étudie pourquoi les equity-claims (actifs que paient un seul dividende futur) ont les primes et le risque décroissante avec l'horizon, mme si les modèles standards impliquent la forme opposée. Je montre que les relations de travail contribue à expliquer l'énigme. Lorsque les travailleurs ont le pouvoir de négociation d'exploiter assurance revenu partiel dans l'entreprise, les salaires sont plus lisses et les dividendes sont plus risqués que dans une économie standard. Risque de répartition entre les travailleurs et les actionnaires fournit une justification à le risque à court terme, ce qui conduit à des term-structures en pente descendante des primes et des risques pour les equity-claims.

The cost-effectiveness and public health benefit of nalmefene added to psychosocial support for the reduction of alcohol consumption in alcohol-dependent patients with high/very high drinking risk levels: a Markov model.

OBJECTIVES: To determine whether nalmefene combined with psychosocial support is cost-effective compared with psychosocial support alone for reducing alcohol consumption in alcohol-dependent patients with high/very high drinking risk levels (DRLs) as defined by the WHO, and to evaluate the public health benefit of reducing harmful alcohol-attributable diseases, injuries and deaths. DESIGN: Decision modelling using Markov chains compared costs and effects over 5 years. SETTING: The analysis was from the perspective of the National Health Service (NHS) in England and Wales. PARTICIPANTS: The model considered the licensed population for nalmefene, specifically adults with both alcohol dependence and high/very high DRLs, who do not require immediate detoxification and who continue to have high/very high DRLs after initial assessment. DATA SOURCES: We modelled treatment effect using data from three clinical trials for nalmefene (ESENSE 1 (NCT00811720), ESENSE 2 (NCT00812461) and SENSE (NCT00811941)). Baseline characteristics of the model population, treatment resource utilisation and utilities were from these trials. We estimated the number of alcohol-attributable events occurring at different levels of alcohol consumption based on published epidemiological risk-relation studies. Health-related costs were from UK sources. MAIN OUTCOME MEASURES: We measured incremental cost per quality-adjusted life year (QALY) gained and number of alcohol-attributable harmful events avoided. RESULTS: Nalmefene in combination with psychosocial support had an incremental cost-effectiveness ratio (ICER) of £5204 per QALY gained, and was therefore cost-effective at the £20,000 per QALY gained decision threshold. Sensitivity analyses showed that the conclusion was robust. Nalmefene plus psychosocial support led to the avoidance of 7179 alcohol-attributable diseases/injuries and 309 deaths per 100,000 patients compared to psychosocial support alone over the course of 5 years. CONCLUSIONS: Nalmefene can be seen as a cost-effective treatment for alcohol dependence, with substantial public health benefits. TRIAL REGISTRATION NUMBERS: This cost-effectiveness analysis was developed based on data from three randomised clinical trials: ESENSE 1 (NCT00811720), ESENSE 2 (NCT00812461) and SENSE (NCT00811941).