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© The Authors 2016. The techniques of economic evaluation have been increasingly widely applied in the health sector over recent decades, with hundreds of published evaluations performed in many countries and ranging across prevention programmes, diagnostics, treatment interventions, and the organization of health care. This paper examines the main methods in current use, and describes the gradual systematization of economic evaluation methodologies and the increasing importance of reimbursement agencies with explicit technical requirements. It reviews controversies in areas such as discounting, analytic perspective, identifying a cost-effectiveness threshold, differential treatment of particular disease areas or treatment groups, and the valuation of outcomes. It then considers in more detail the development of the World Health Organization's generalized cost-effectiveness framework, and the emergence of an international 'reference case' commissioned by the Bill and Melinda Gates Foundation as a way of increasing the generalizability and comparability of such studies. Finally the paper discusses some current controversies and possible future developments in this field.

Original publication




Journal article


Oxford Review of Economic Policy

Publication Date





102 - 121