Given a choice between spending more money on medical care or on other consumption goods, which should society choose? Should the National Institutes of Health devote a larger part of its research budget to AIDS or to cancer? Has the increased inequality of income in the United States led to worse health among the poor? Answering these questions is fundamental to understanding the medical sector and to forming sound public policy. But knowledge about the value of health is limited. At both a conceptual and empirical level, there are few integrated treatments of population health. In this paper and related work (Cutler and Richardson, 1997), we estimate the health of the United States population, and examine how it has changed over the past several decades.
