Photo of Abe C. Dunn.

Assistant Chief Economist

Abe C. Dunn

Education

Ph.D.
University of Texas at Austin
Economics
2006
B.A.
University of Oregon
Economics and Mathematics
2000

Areas of Interest

Health
Applied Econometrics
Industrial Organization
Paper (BEA-WP2023-3)

Consumption Zones (PDF)

Andrea Batch , Benjamin R. Bridgman , Abe C. Dunn , and Mahsa Gholizadeh

Are Medical Care Prices Still Declining? A Re-examination Based on Cost-Effectiveness Studies tanya.shen Fri, 10/01/2021 - 13:17
External Paper/Article

More than two decades ago a well-known study on heart attack treatments provided evidence suggesting that, when appropriately adjusted for quality, medical care prices were actually declining (Cutler et al. 1998). Our paper revisits this subject by leveraging estimates from more than 8,000 cost-effectiveness studies across a broad range of conditions and treatments. We find large quality-adjusted price declines associated with treatment innovations. To incorporate these quality-adjusted indexes into an aggregate measure of inflation, we combine an unadjusted medical-care price index, quality-adjusted price indexes from treatment innovations, and proxies for the diffusion rate of new technologies. In contrast to official statistics that suggest medical care prices increased by 0.53 percent per year relative to economy-wide inflation from 2000 to 2017, we find that quality-adjusted medical care prices declined by 1.33 percent per year over the same period.

 
Additional Information

 

 

Abe C. Dunn , Anne E. Hall , and Seidu Dauda

Econometrica, Forethcoming