Who gains under price rationing?
The rich. And everyone else as well.
The economy is not a zero sum game. Under a price rationing system, the vaccines will get out to the public more quickly and fewer people will die. It’s true that many of the first doses would go to wealthier individuals, but that’s also true of non-price rationing. In practice, states spent so much time fighting over how to distribute the vaccines in a “fair” way that they slowed the rollout of vaccines, leading to many needless deaths.
PS. Of all the head-scratching decisions made by the US government during the past year, it’s hard to top the one described in this new Alex Tabarrok post. Imagine being a government official making a decision that costs thousands of lives, and has precisely zero benefit to anyone.
READER COMMENTS
Thomas Hutcheson
Mar 14 2021 at 3:58pm
Distribution including “equity” considerations compared to distribution only according to vulnerability or transmissibility certainly could result in fewer people being vaccinated, but was it the case when and where? And if it did have that result, how big was it, especially compared to the decision not to go with First Dose First?
[I live in DC where certain zip codes (where cases have been higher and initial vaccine take-up has been lower] had a slight advantage in signing up online. But as first approximation it looks to me as if that would not result in fewer vaccinations, although I have not seen a study looking at this.]
MarkW
Mar 15 2021 at 5:57pm
Imagine being a government official making a decision that costs thousands of lives, and has precisely zero benefit to anyone.
I can’t imagine making such a decision and sleeping at night but I can easily imagine what they’re thinking. The potential political downside to allowing the export of the unusable vaccines would be the possibility of facing an attack ad to the effect of “This administration exported millions of vaccines when millions of AMERICANS couldn’t get one!!!”. In contrast, there’s no political downside to doing nothing. Yes, thousands may die unnecessarily, but you know, they’re foreigners not voters, so…
But now that the NY Times has picked up this story, there might start to be a political downside to doing nothing. Understand, though, if the government does change its mind, it will be because of the political calculus, not the potential body count. Yet another reminder that governments are run by high-functioning sociopaths.
Everett
Mar 16 2021 at 4:18pm
OTOH I think we can all agree that local, independently owned pharmacies (and ironically semi-centralized government) work better than rolled up national chains at distributing vaccines.
https://mattstoller.substack.com/p/how-monopolies-slowed-the-vaccine
https://www.bloomberg.com/news/newsletters/2021-03-16/west-virginia-becomes-an-unlikely-u-s-vaccination-star
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