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PaperclipPerfector  12d ago (text post)   33859 thread views

Culture War Roundup for the week of November 11, 2024

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Let's do a little back of the envelope calculation.

Infectious disease mortality declined during the first 8 decades of the 20th century from 797 deaths per 100000 in 1900 to 36 deaths per 100000 in 1980.

https://pubmed.ncbi.nlm.nih.gov/9892452/

The actual infectious disease mortality in 1980 was 80k people. At 1900 mortality rates, it would have been 1.8M, so let's ballpark it at 1.7M deaths averted thanks to sanitation and antibiotics. FEMA values a human life at $7.5M. 1.7M people * $7.5M/person = $13T. US GDP in 1980 was $3T.

Obviously this is highly simplified, but I think it's safe to say that vaccine companies did not capture a large part of the benefits of vaccines.

But a large part of that value was captured by the customer (ie not an externality).

The argument for eliminating liability is that the cost benefit to the individual is negative (otherwise pharma could raise the cost to account for liability while customers would still buy since positive EV) but the benefit to society is positive.

Of course there could be an elasticity issue but that implies the cost to vaccines are much higher compared to what people think.

If the vaccine manufacturer is not capturing all the benefit of the vaccine but is liable for all the downside, it's clear that the math isn't mathing even for plainly good vaccines.

Just to expand, the three theoretical cases where liability prevents a valuable good from being produced is where there is a large positive externality (ie a benefit derived by neither the seller nor buyer such that the buyer is not willing to pay more), ability to pay for buyers, or where liability isn’t properly measured (eg the Bronx jury). Before we accept that the case applies here, we ought to actually prove it out. After all, vaccines didn’t have immunity from liability until the 1980s

That just isn’t correct. The vast majority of manufacturers are subject to strict liability and they don’t capture all of the benefit. Yet they survive because they make an EV+ product.

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