ABSTRACT
This chapter begins with the concerns and difficulties of the valuation of life from an individual and aggregate perspective. The notion of statistical value of life is particularly based on the notion of willingness to pay. Similarly, the chapter introduces the most popular measure of valuation of quality of life. These ideas help to pin down the concept of demand for health care services based on Grossman's contributions. The chapter presents an in-depth analysis of Grossman's approach; its characteristics, results, extensions, criticisms, and applications. Finally, uncertainty is introduced in the analysis for health care.
