Volume 16, Number 4 (Fall) 1981
Weisbrod, Burton A. 1981. "Benefit-Cost Analysis of a Controlled Experiment: Treating the Mentally Ill." Journal of Human Resources 16(4):523-550.
This study is the first benefit-cost analysis of a controlled (random assignment) experiment in the mental health field. It compares, in terms of an unusually wide variety of "tangible" and "intangible" forms of benefits and costs, a traditional hospital-based approach to treating the mentally ill with a nontraditional community-based approach. The study highlights the very different forms taken by the effects of the alternative therapies. Thus it shows how distorted conclusions can result from a failure of benefit-cost analyses to measure benefits and costs comprehensively; a change in form can be mistaken for a change in level of costs or benefits.
The author is Professor of Economics and Fellow, Institute for Research on
Poverty, University of Wisconsin-Madison.
* This research would not have been undertaken but for the interest of Dr.
Leonard Stein, who proposed undertaking an economic benefit-cost analysis in
conjunction with the experiment that he and Dr. Mary Ann Test were designing at
the Mendota Mental Health Institute, where they were, respectively, Director and
Associate Director of Research. Their help throughout the economic study was
valuable. I thank them. I also thank Margaret Helming, A. James Lee, and Olivia
Mitchell, who served as research analysts at various stages in the economic
analysis; they made significant contributions. Susan Feigenbaum, Steven LaValley,
and Steven Verrill also provided important research assistance. Helpful comments
on an earlier draft of this paper were made by Janice Giesige and Teh-wei Hu.
This study was supported by Grant 05-R-00XXJ9 from the National Institute of
Mental Health, by the University of Wisconsin Health Economics Research Center,
and by funds granted to the Institute for Research on Poverty at the University
of Wisconsin-Madison by the U.S. Department of Health, Education, and Welfare
pursuant to the provisions of the Economic Opportunity Act of 1964.
© 2003 by the Board of Regents of the University of Wisconsin System
US ISSN 0022-166X