Treatment value of residual functional capacity improvement among Disabled Workers: Accounting for Hedonic Psychological Biases

A.C. Furnée, G.A. Pfann, M.A. Kemler

Research output: Contribution to journalArticleAcademicpeer-review

Abstract

We propose to use the theoretical mincer-ofek (1982) model of career interruptions for the evaluation of a health producing treatment that improves residual functional capacity of workers with peripheral nerve injuries who developed chronic pain (reflex sympathetic dystrophy). The revalued potential to – partially – continue to accumulate productive human capital is linked to increased lifetime earnings capacity restoring – missed out – accumulated productivity. We assume that a worker's psychological well-being directly influences earnings, but also affects the cognitive mechanism to experience pain. Randomized clinical trial data and individual medical records from impaired workers are compared with a control group of randomly selected healthy workers. The estimate of the treatment's average net present value is 49.500 euros per person (in 1995 dutch guilders constant terms).
Original languageEnglish
Pages (from-to)171-192
JournalDe Economist
Volume151
DOIs
Publication statusPublished - 1 Jan 2003

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