Screening and preventable illness

Margaret M. Byrne, Peter Thompson

Research output: Contribution to journalArticlepeer-review

15 Scopus citations

Abstract

If an agent does not discount the future at a constant rate, as in some forms of myopia, her optimal strategy is unattainable without some commitment device. We apply this familiar idea to a model of screening and disease prevention, and explore how financial incentives can correct suboptimal health choices. In general, myopia need not imply under-screening. While the optimal intervention for prevention effort is a state-invariant subsidy, the optimal intervention for screening may involve a tax or a subsidy. When screening and prevention are coincident, a simple and practical subsidy equal to one minus the discount factor to both screening and intervention is indicated.

Original languageEnglish (US)
Pages (from-to)1077-1088
Number of pages12
JournalJournal of Health Economics
Volume20
Issue number6
DOIs
StatePublished - Nov 9 2001

Keywords

  • Financial incentives
  • Medical screening
  • Myopia
  • Time-inconsistency

ASJC Scopus subject areas

  • Economics and Econometrics

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