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Archive for the 'Econometrics' Category

Are you really disabled?

When the government extends benefits to individuals with specific characteristics (e.g., poverty, disability), the number of people who claim to have these characteristics will necessarily increase.  For instance, there are reports that unemployed individuals who no longer qualify for welfare are now moving onto the disability rolls in large numbers.  Are these people really disabled? A recent study  by Gosling […]

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The Efficiency Frontier in Health Economics

Which treatments are better than others? Ideally, medicines that provide large health benefits and cost little will be preferred to those that offer little health benefits and/or cost a lot. In health economics, one way to systematically evaluate different treatments is the efficiency frontier. The efficiency frontier methodology is an extension of the standard approach […]

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Type I and Type II Errors for Dummies

In previous posts, I have describe in detail what constitutes Type I and Type II errors.  This figure, however, conveys the concept much more succinctly. HT: Marginal Revolution.

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Guidelines for indirect treatment comparisons

Is treatment A better than treatment B?  This questions is often difficult to answer, especially if there is not head-to-head evidence comparing the two treatments.  In other cases, however, one can use indirect evidence.  For instance, one randomized controlled trial (RCT) may compare treatment A to C (e.g., a placebo) and another trial can compare […]

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How much should you bet?

This is an interesting question to ask.  If you are going to the casino, in most cases, the answer is $0.  The odds are stacked against you.  But what if the odds are in your favor, or you believe that your own predicted probability of winning differs from that of the bet? The easy answer […]

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Quotations on Big Data

“There are a lot of small data problems that occur in big data.  They don’t disappear because you’ve got lots of the stuff. They get worse.” David Spiegelhalter, Winton Professor of the Public Understanding of Risk at Cambridge university Via FT.

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Extended Cost Effectiveness Analysis

Most people know what cost-effectiveness analysis (CEA), but what is extended cost effectiveness analysis (ECEA)?  A paper by Verguet, Laxminarayan,and Jamison (2014) describes the ECEA approach as it relates to the benefits of universal public finance (UPF) of specific medical treatments.  CEA measures the effectiveness of a treatment relative to its cost.  ECEA does this […]

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Increasing Generalizability of RCTs

Is your randomized controlled trial (RCT) generalizable to the general population?  This question is known as external validity and is a major issue for a number of treatments.  Sometimes, a treatment is very effective in an RCT, but less so in the real world. One reason why this may be the case is that the […]

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Lost in Translation? Types of Studies in the Economics and Medical Discipline

Statistics are statistics, but different disciplines use different terminology to refer to the same types of analysis.  A 2013 Institute of Medicine Report on cancer care lists a number of different study types (see below).  Whereas economists would refer to a study that examines  groups with and without an event or outcome as a “difference-in-difference” study, […]

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Testing multiple hypotheses simultaneously

Most people know about the good ol’ t-test.  You present a null hypothesis (e.g., the Healthcare Economist is the most popular blog covering health economics on the web), collect data to conduct the test, and use the mean and variance of the data to test whether your hypothesis is true. Standard convention holds that most […]

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