Unit value of restricted activity days (RADs)

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Unit cost of restricted activity days (RADs). RAD is defined as a day when a person needs to change his/her normal activities because of ill-health. It is based on surveys among general population. In terms of severity, RADs include: 1) days needed to stay in bed, 2) days of work/school (WLS) and 3) days of other, less serious restrictions on normal activity (MRADs).

Definition

Data

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ExternE (2005)[1]

  • 49 €/RAD (includes disutility, price year 2003)
  • 137 €/RAD (includes disutility and opportunity cost, price year 2003)

Disutility cost

  • 148 €/3 symptom days
  • Symptom described as confined to bed, shortness of breath on slight exertion
  • Based on Ready et al. (2004)[2]:

Opportunity cost

  • Direct cost (salary cost of absent individual, replacement cost, lost service or production time)
    • Mean: 114 €/employee-day absence
    • Median: 85 €/employee-day absence (recommended central estimate)
  • Indirect cost (lower customer satisfaction, poorer quality of products or services leading to a loss of future business): 168 €/emloyee-day absence
    • There is less confidence in this value due to low survey response rate. Representativeness not fully established.
  • Based on CBI (1998)[3]

A crude alternative to the figures presented above is to use information from EUROSTAT Statistical Yearbook on mean annual gross earnings paid to EU employees and divide this by the size of labour force to give mean annual productivity. This gives a value of €56. However, the estimate does not include all costs (direct or indirect), and is therefore recommended to be used as a lower boundary estimate.

Country-specific estimates of direct and indirect costs are can be derived by scaling EUROSTAT country data to EUROSTAT data for UK, and to apply this scaling factor to the values derived from CBI study. If this data is not available, country purchasing power parity relative to UK can be used.

  • Mean total cost estimates (including direct and indirect costs) for EU
    • lower bound €58
    • Central estimate €88
    • upper bound €261

Causality

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Unit

Unit in which the result is expressed.

€/RAD

Formula

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Result

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137

See also

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References

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  1. ↑ European Commission 2005. ExternE, Externalities of Energy, Methodology 2005 Update. Bickel P & Friedrich R (Eds.)
  2. ↑ Ready R, Navrud S, Day B, Dubourg R., Machado F., Mourato S, Spanninks F & Rodriguez MXV (2004). Benefit Transfer in Europe: How Reliable Are Transfers Across Countries? Environmental & Resource Economics, 29: 67-82
  3. ↑ CBI (1998). Missing Out: 1998 Absence and Labour turnover Survey, London: Confederation of British Industry (CBI).
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