Discounting in decision making: the consistency argument revisited empirically

Area of Science:

• Health Economics
• Decision Science

Background:

• Discounting costs and health effects is standard in economic evaluations.
• Questions persist regarding the consistency and appropriateness of uniform discount rates (3-5%).
• The Weinstein and Stason consistency argument frames ongoing debates.

Purpose of the Study:

• To test the consistency of societal decision-makers' preferences for present versus future costs and health effects.
• To determine if decision-makers discount costs and health effects at the same rate.
• To explore alternative bases for discount rates, such as health endowment growth.

Main Methods:

• Utilized hypothetical health care programs, similar to Weinstein and Stason's.
• Assessed decision-makers' preferences regarding present and future costs and health outcomes.
• Analyzed responses for consistency and discount rate application.

Main Results:

• Decision-makers exhibited significant inconsistency in preferences for present versus future costs and health effects.
• Respondents were susceptible to problem framing and displayed myopic tendencies.
• Discount rates for health appeared linked to expectations of future life expectancy, varying by elicitation method.

Conclusions:

• Appointed decision-makers struggle to provide consistent preferences for discounting costs and health effects in economic evaluations.
• Current discounting practices may not reflect stable or rational decision-making.
• The growth rate of health endowment offers a potential alternative basis for discount rates, warranting further investigation.