Cost-Effectiveness and Cost–Benefit Analysis

Abstract

Chapter 16 gives an overview of cost-effectiveness and cost-benefit analysis. Every year millions of dollars are spent on food and nutrition intervention programs that are designed to improve health. Given money can always be spent in many different ways leads to a natural question: How effective was the program, relative to how much it cost? There are two standard approaches to answering this question: a cost effectiveness analysis and a cost benefit analysis. The chapter covers the main questions that must be answered in doing either a cost effectiveness or cost benefit analysis. The main formulas in each approach are presented. The pros and cons of each approach are discussed. A hypothetical nutrition intervention program is carried throughout to provide context for the discussion.