The Capability Approach: A critical review of its application in health economics

The capability approach is an approach to assessing well-being developed by Amartya Sen. Interest in this approach has resulted in several attempts to develop questionnaires to measure and value capability at an individual level in health economics. The methods of measuring and valuing capability used in the questionnaires are critically reviewed in this paper. It is argued that the methods used to measure capability result in a capability profile that is often an inaccurate description of the individual’s true capability set. In addition, existing methods of valuing capability do not consider that capability is a set, consisting of multiple combinations of functionings rather than a single combination, which means that existing methods of valuing capability may be inadequate. The difficulties in measuring and valuing capability faced by existing questionnaires means that using the capability approach in economic evaluations will require a significant amount of further research.