QUANTITATIVE METHODS FOR HEALTH CARE

Quantitative Methods for Health Care



Quantitative Methods for Health Care

Identify some possible problems in the quantitative analysis approach. Discuss some possible solutions for one such problem.

Some disadvantages o f quantitative analyses are as follow s :

Can encourage research e r s to act as if they can ignore whatever they have yet to learn how to measure.

Can en courage researchers to a c t a s if their finding s are useless un less

they include everything that might be relate d t o the phenomenon of interest.

collect a much narrower and sometimes superficial dataset

results are limited as they provide numerical descriptions rather than detailed narrative and generally provide less elaborate accounts of human perception

the research is often carried out in an unnatural, artificial environment so that a level of control can be applied to the exercise. This level of control might not normally be in place in the real world yielding laboratory results as opposed to real world results

in addition preset answers will not necessarily reflect how people really feel about a subject and in some cases might just be the closest match.

the development of standard questions by researchers can lead to 'structural' bias and false representation, where the data actually reflects the view of them instead of the participating subject.

Discuss three potential problems with people (two with management and one with the quantitative analysts themselves) that may hinder successful implementation of a quantitative model.

Most quantitative models go through a least one stage of gestation known as a "back-test". This process in an empirical study which attempts to judge if a particular investment technique would have been successful had it been applied in the past. If it appears from the test that the methods under study would have been successful in meeting the hopefully well defined goals of our investors, then the method is often tried in simulated or "paper" trading in purportedly current investment conditions. The central point of this paper is to consider the reasonable extent to which "back-tests" and simulated trading may be relied upon as indicative of likely results in actual implementation. For a short answer to this question, please see the third page of exhibits. The essence of a back-test is to step backward in time to some past point and then come forward, simulating what we believe our actions would have been, assuming we had previously formulated the investment approach which are now testing (and therefore was presumably only formulated in the recent past). Another conceptual problem with back-tests is the implication of the detached observer. The tests assume that had we developed the technique we are now testing at some earlier date, we could have applied such a technique, garnered the potential success thereof and had no impact on the markets. In financial markets, where there must be a buyer for every seller and a seller for every buyer this is conceptually weak. Even in a market of infinite liquidity, competitive business pressures cause market participants to observe each ...