Payback Period
The length of time required for the cumulative cash inflows from an investment to equal its initial cost.
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.
Pearson Correlation
A measure quantifying the strength and direction of the linear relationship between two continuous variables, ranging from negative one to positive one.
Percentile
A descriptive statistic indicating the value below which a specified percentage of observations in a dataset fall.
Permutation Test
A non-parametric hypothesis test determining significance by repeatedly rearranging observed data labels to build an empirical distribution under the null hypothesis.
Perspective
The viewpoint adopted in an economic evaluation that determines which categories of cost and outcome are included, such as payer, patient, or societal.
Peto Test
A variant of the log-rank test using a specific weighting scheme offering statistical efficiency advantages under certain patterns of censoring.
Pharmacokinetics
The study of how the body absorbs, distributes, metabolises, and eliminates a drug over time, covering bioavailability, clearance, and half-life.
Piecewise Model
A survival model dividing follow-up into distinct segments, each modelled with a separate, often simpler function, letting the hazard shape vary in steps.
Point Estimate
A single numerical value representing the best available estimate of an unknown parameter, unlike an interval estimate conveying its uncertainty range.
Poisson Distribution
A discrete probability distribution describing the number of times an event occurs within a fixed interval, assuming independence and a constant average rate.
Poisson Regression
A modelling technique analysing count outcome data, such as clinical events per patient, based on the assumption that outcomes follow a Poisson distribution.
Pooling Equilibrium
A market outcome in which different risk types make the same choice, so a firm cannot distinguish between them from behaviour alone.
Population EVPI
The expected value of perfect information calculated for an entire affected patient population over time, rather than for a single patient.
Positive Externality
A benefit conferred on a third party by an economic activity, not reflected in its market price, leading to underproduction relative to the social optimum.
Posterior Distribution
In Bayesian statistics, the updated probability distribution for a parameter after combining a prior distribution with the likelihood of observed data.
Posterior Probability
The updated probability of a hypothesis after accounting for observed evidence, combining a prior probability with the likelihood of that evidence.
Prediction Error
The difference between a value predicted by a statistical model and the value that is actually observed.
Prediction Interval
A range calculated to contain a future individual observation with a specified confidence, unlike a confidence interval describing a population parameter.
Predictive Accuracy
The degree to which a model's forecasts or classifications correspond to actual observed outcomes when tested against real data.
Present Value
The current worth of a future sum of money or cash flow stream, found by discounting each future amount using a specified discount rate.