T Jefferson, V Demicheli, M Mugford. (Pp 132; £16.95). London: BMJ Books, 2000. ISBN 0 7279 1478 2

At a time when spending on health care continues to increase and there are demands for even greater quantities of resources to fund health services, the need to ensure that resources are used well is a priority. The money spent on health services ends up as income for providers that is an accounting identity. The degree to which it generates health benefits that are valued by society or patients depends on what the resources are used for and at what cost.

Economic evaluation is the activity which provides data that can inform decisions about how resources are best used. This field has grown rapidly over the last decade in both the number and range of economic evaluations and also in methodological complexity. In addition, the results of evaluations are increasingly being used by public bodies to determine whether, and at what price, health technologies will be covered by health budgets.

This book, now in its second edition, is a concise, well written, and useful guide to some of the key principles and methods for carrying out economic evaluations. Each approach is illustrated by a step-by-step case study which will help people to appraise studies critically or to think about the design of a new evaluation.

The book devotes a whole chapter to the cost of illness studies, including the World Health Organisation global burden of disease project which has been so succinctly demolished by Williams.¹ Since they simply (and usually inaccurately) measure the costs associated with a condition and say nothing about the degree to which society's resources can do anything to change this burden and at what net cost, these studies are not particularly helpful. The next edition will hopefully have a greater emphasis on the equity outcomes of health care interventions, something which should also be an element of evaluations. Finally, the book could be strengthened by referring readers to online databases of critically appraised economic evaluations such as the NHS Economic Evaluation Database [http://agatha.york.ac.uk/welcome.htm]

Despite these weaknesses, though, it is probably the best introductory text available.