Cost-Effectiveness Analysis of Education and Health Interventions in Developing Countries

High-quality impact evaluations, including randomized experiments, are increasingly popular, but cannot always inform resource allocation decisions unless the costs of interventions are considered alongside their effects. Cost-effectiveness analysis is a straightforward but under-utilized tool for determining which, of two or more interventions provides a (non-pecuniary) unit of effect at least cost. This paper reviews the framework and methods of cost-effectiveness analysis, emphasizing education and health interventions, and discusses how the methods are applied in the literature.