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Decision Thresholds for Medical Tests Under Ambiguity Aversion

Sevim, Dilek and Felder, Stefan. (2022) Decision Thresholds for Medical Tests Under Ambiguity Aversion. Frontiers in Health Services, 2. p. 825315.

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Abstract

We consider medical decision-making under diagnostic and therapeutic uncertainty and analyze how ambiguity aversion affects the decisions to test and treat, thereby contributing to the understanding of the observed heterogeneity of such decisions. We show that under diagnostic ambiguity (i.e., the probability of disease is ambiguous), prior testing becomes more attractive if the default option is no treatment and less so if the default option is treatment. Conversely, with therapeutic ambiguity (i.e., the probability of a successful treatment is ambiguous), ambiguity aversion reduces the tolerance toward treatment failure so that the test option is chosen at a lower probability of failure. We differentiate between conditional and unconditional ambiguity aversion and show that this differentiation has implications for the propensity to test. We conclude by discussing the normative scope of ambiguity aversion for the recommendations and decisions of regulatory bodies.
Faculties and Departments:06 Faculty of Business and Economics > Departement Wirtschaftswissenschaften > Professuren Wirtschaftswissenschaften > Health Economics (Felder)
UniBasel Contributors:Felder, Stefan
Item Type:Article, refereed
Article Subtype:Research Article
Publisher: Frontiers Media
e-ISSN:2813-0146
Note:Publication type according to Uni Basel Research Database: Journal article
Language:English
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Last Modified:31 Oct 2022 12:29
Deposited On:31 Oct 2022 12:29

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