Productivity and quality-adjusted life years: QALYs, PALYs and beyond

We develop a unified framework for the measurement and valuation of health and productivity. Within this framework, we characterize evaluation functions allowing for compromises between the classical quality-adjusted life years (QALYs) and its polar productivity-adjusted life years (PALYs). Our framework and characterization results provide a new normative basis for the economic evaluation of health care interventions, as well as occupational health and safety policies, aimed to impact both health and productivity of individuals.