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SCREENING FOR A CHRONIC DISEASE: A MULTIPLE STAGE DURATION MODEL WITH PARTIAL OBSERVABILITY
Author(s) -
Mroz Thomas A.,
Picone Gabriel,
Sloan Frank,
Yashkin Arseniy P.
Publication year - 2016
Publication title -
international economic review
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 2.658
H-Index - 86
eISSN - 1468-2354
pISSN - 0020-6598
DOI - 10.1111/iere.12180
Subject(s) - observability , duration (music) , status quo , medicine , value (mathematics) , disease , econometrics , economics , statistics , mathematics , art , literature , market economy
We estimate a dynamic multistage duration model to investigate how early detection of diabetes can delay the onset of lower extremity complications and death. We allow for partial observability of the disease stage, unmeasured heterogeneity, and endogenous timing of diabetes screening. Timely diagnosis appears important. We evaluate the effectiveness of two potential policies to reduce the monetary costs of frequent screening in terms of lost longevity. Compared to the status quo, the more restrictive policy yields an implicit value for an additional year of life of about $50,000, whereas the less restrictive policy implies a value of about $120,000.