7 - Personalized Treatment

Summary

Section 7.1 examines the idealized setting where optimal utilitarian planning is feasible. I quantify the value of covariate information in improving achievable social welfare. Conditioning treatment choice on more refined covariate information cannot lower social welfare in this setting. It increases welfare if covariate refinement has predictive power that affects treatment choice. I also discuss nonutilitarian arguments to disregard certain covariate information when making clinical and criminal justice decisions.

The remainder of the chapter considers planning when uncertainty about treatment response makes optimization infeasible. Section 7.2 distinguishes settings where the planning problem does or does not decompose into a set of separable covariate-specific problems. The former situations are easier to study than the latter. Section 7.3 considers the common medical problem of choice between surveillance and aggressive treatment of patients, with partial knowledge of personalized risk of illness. Section 7.4 extends the analysis to sequential choice of whether to acquire costly covariate information as a prelude to treatment choice. I focus on medical choice to perform a diagnostic test before making the treatment decision.