Abstract
For cost-effectiveness analysis to be consistent with expected utility maximization, David Meltzer has proposed that the difference between consumption and production should be included as costs in added years of life. In order to obtain an estimate of these costs, average production and consumption figures by age for the general population in Sweden were conlpiled. Production is here defined as the total labour cost, including pre-tax income and pay-roll taxes, but excluding transfer payments such as paid sickleave. Private consumption was mainly estimated from a consumer expenditure survey. Public consumption was estimated from the Swedish national accounts and other government sources. Health care consumption by age was given particular consideration, since these costs are interesting in their own right from a health economic viewpoint. Towards the end of the paper, the reliability and validity of the age distribution of consumption and production is discussed, as well as applications to health economic evaluations.