Most of economics tends to assume that people are rational decision makers who try to maximize their utility. In general, this seems to me to be a pretty reasonable assumption; however, it's sometimes difficult to predict what gives people utility.
I was reminded of this when I saw a story about a new vaccine for shingles, a particularly painful outbreak of rash or blisters that is caused by the same virus that causes chickenpox. Given the incredible discomfort caused by this disease, you would think that consumers would be willing to pay a fairly sizeable amount to avoid it. Well, not in all cases. According to the article, here's the view of one consumer who already suffered through one "quite nasty" case and doesn't want to pay $200 for a vaccine to prevent another case:
"I can afford to do it, but I got my back up and I'm not going to," said Davidson, who regards her refusal as something of a moral issue. "More people should take a stand; $200 is a horrendous amount of money. The drug companies are rolling in money and should help pay instead of running full-page ads," she said, citing prominent advertisements for the vaccine taken out by manufacturer Merck earlier this year.
I hope Ms. Davidson derives sufficent utility from her moral stand of sticking it to the drug companies to compensate her for the pain of another instance of shingles.
My guess is that when pushed further, Ms. Davidson would defend the $50 that she pays per month for her cell phone to be "essential" to her life. This raises an interesting question, who is valuable enough to society that they need to remain in constant communication yet does not earn (or have) enough disposable income to pay for medically relevant expenses?
ReplyDelete