In "exclusive" Westchester County, the large Mount Kisco Medical Group quickly exhausted its supply of H1N1 vaccine. Likewise, in the wealthy Boston suburb of Lexington, parents faced long vaccine queues this past Saturday, and discovered that demand exceeded supply. In both places, patients were charged for the vaccine. Other anecdotes of similar shortages made headlines across the country.

In contrast, the NY Times is reporting this morning that NY City provided free vaccines to middle school and high school students, and essentially no one showed up. They were expecting to provide 31,500 vaccines, but only administered 1,701.

Since it seems implausible to consider H1N1 vaccines a Giffen Good, what economic/market model can describe this phenomenon? Is this a socioeconomic phenomenon? A distrust of local public health authorities? Or an apathy unique to NY City? Is there a larger lesson that may apply to the Washington health care debate currently underway?





Speak your mind

4 Comments so far

  1. Russell Sears on November 10, 2009 2:02 pm

    The uproar over hockey players' getting the vacine in Canada, and this story seems to support that this is a Veblen good. It's about status. Those getting a shot are either more important, have better connections or are smarter than the rest of "us". Getting in line with "poor" people for a handout debunks this feeling.

  2. Rocky Humbert on November 10, 2009 3:45 pm

    @Russell Sears:

    I guess there may be some sort of social status conveyed to soccer moms and soccer dads who wait for hours to get their kids immunized; and this culture is lacking in the inner-city.

    But I also thought a “Veblen Good” requires “conspicuous consumption.” In this example, the only conspicuous element will be not-keeling-over from H1N1. (Not as dramatic as the 3ct diamond ring for mom, and a new Porsche in the driveway for dad.)

  3. V.K. on November 10, 2009 7:35 pm

    It could also reflect the opportunity cost. Wealthy people tend to put higher value on health and therefore getting sick is costly, it would take time from going to classes and developing human capital, etc. While in NYC, the cost of getting sick is low - chances are you will miss school for one reason or another anyway and forgone health is not valued that highly.

  4. David Riffer on November 11, 2009 1:04 am

    Centralized planning and markets are both constructs for rationing scarce goods. In this case public health administrators made decisions to maximize the public good, which was politically necessary because markets are amoral. Yet, centralized planning always suffers from failures of imagination, whereas markets tend to adapt, and figure out solutions. Note that in the case of the vaccine, far fewer doses have been and will be produced than was possible due to poor decisioning by people who don’t seem likely to be held accountable for the consequences of their choices.

    Applying this to the larger health care debate: socialization of catastrophic coverage, federal rather than state regulation of health insurance, and the cessation of tax preferences for employer provided health insurance seem like the right essential elements. Sadly, the distance between should and will won’t be bridged.


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