Productivity costs in economic evaluations: past, present, future

Pharmacoeconomics. 2013 Jul;31(7):537-49. doi: 10.1007/s40273-013-0056-3.


Productivity costs occur when the productivity of individuals is affected by illness, treatment, disability or premature death. The objective of this paper was to review past and current developments related to the inclusion, identification, measurement and valuation of productivity costs in economic evaluations. The main debates in the theory and practice of economic evaluations of health technologies described in this review have centred on the questions of whether and how to include productivity costs, especially productivity costs related to paid work. The past few decades have seen important progress in this area. There are important sources of productivity costs other than absenteeism (e.g. presenteeism and multiplier effects in co-workers), but their exact influence on costs remains unclear. Different measurement instruments have been developed over the years, but which instrument provides the most accurate estimates has not been established. Several valuation approaches have been proposed. While empirical research suggests that productivity costs are best included in the cost side of the cost-effectiveness ratio, the jury is still out regarding whether the human capital approach or the friction cost approach is the most appropriate valuation method to do so. Despite the progress and the substantial amount of scientific research, a consensus has not been reached on either the inclusion of productivity costs in economic evaluations or the methods used to produce productivity cost estimates. Such a lack of consensus has likely contributed to ignoring productivity costs in actual economic evaluations and is reflected in variations in national health economic guidelines. Further research is needed to lessen the controversy regarding the estimation of health-related productivity costs. More standardization would increase the comparability and credibility of economic evaluations taking a societal perspective.

Publication types

  • Research Support, Non-U.S. Gov't
  • Review

MeSH terms

  • Absenteeism
  • Cost-Benefit Analysis / economics*
  • Cost-Benefit Analysis / standards
  • Costs and Cost Analysis / economics*
  • Costs and Cost Analysis / ethics
  • Costs and Cost Analysis / trends*
  • Disabled Persons
  • Efficiency* / ethics
  • Humans
  • Mortality, Premature
  • Sick Leave / economics
  • Work / economics