Kakwani Index
A measure of the progressivity of a tax or financing system, calculated as the concentration index of payments minus the Gini coefficient of pre-tax income.
Encyclopaedia
Explore comprehensive, evidence-informed explanations of key health economics concepts, including their development, application and relationships to other concepts. Published entries are validated through human expert review.
Latent Class Model
A statistical model that assumes a population consists of unobserved subgroups with distinct preferences, estimating both each subgroup's traits and individual membership probability.
Liquidity Ratio
A financial ratio measuring an organisation's ability to meet short-term financial obligations using its most readily available assets.
Lorenz Curve
A graph plotting the cumulative share of total income against the cumulative share of population, ranked poorest to richest, showing distribution.
Magnitude Estimation
A psychophysical scaling method in which respondents assign numbers to stimuli reflecting their perceived relative magnitude compared to a reference stimulus.
Mapping Algorithm
A statistical model predicting a health utility value from responses on a non-preference-based instrument, used when a preference-based measure was not collected.
Mapping Function
The specific statistical relationship, typically estimated through regression, used within a mapping algorithm to convert a health status score into a predicted utility value.
Marginal Analysis
An approach to resource allocation examining the additional cost and benefit of small changes in an activity's level, rather than its total cost and benefit.
Marginal Benefit
The additional benefit gained from one more unit of a good, service, or activity.
Marginal Cost
The additional cost incurred in producing one more unit of a good or service.
Marginal Cost Estimation
The process of estimating the additional cost of producing one more unit of a good or service at the current level of output.
Marginal Cost of Healthcare
The additional cost of providing one more unit of healthcare service, such as treating one further patient.
Marginal Cost-Effectiveness
The additional cost required to produce one more unit of health effect at the margin of an intervention's current scale, distinct from its average.
Marginal Rate of Substitution
The rate at which a consumer is willing to trade one good for another while keeping the same overall level of satisfaction.
Market Clearing
A condition in which price has adjusted so that quantity supplied exactly equals quantity demanded, eliminating any surplus or shortage.
Market Equilibrium
A state in which the quantity of a good supplied equals the quantity demanded at the prevailing price, with no tendency to change.
Market Failure
A market failure occurs when market exchange does not produce an efficient allocation of resources because prices or incentives fail to reflect relevant costs, benefits, information or competitive conditions.
Maximin Criterion
A social welfare decision rule judging an allocation by the wellbeing of the worst-off group, seeking to maximise that minimum level.
Mechanism Design
A branch of economic theory concerned with designing rules, such as auctions or payment systems, that produce good outcomes despite strategic, privately informed participants.
Meta-Regression Transfer
A form of benefit transfer in which a regression model estimated across many original studies predicts a value for a new context based on its characteristics.