At 5:55 PM -0500 2/18/98, Perry E. Metzger wrote:
>Which problem, exactly, are you refering to here? That is to say, what
>is the problem to me if *you* are unvaccinated provided that I am?
None. Assuming that vaccination wroks perfectly, the positive externality
from one more person getting vaccinated goes to the people who are
unvaccinated.
The market equilibrium is, say, 80% of the population vaccinated, with the
marginal unvaccinated person having a private cost to vaccination of $20.01
and a private benefit ot $20.00. The efficient outcome is, say, 90%
vaccinated, with the marginal unvaccinated person having a private cost of
$20.01, a private benefit of $18.00, and an external benefit, via lowering
the risk to the remaining 10%, of $2.00. His private benefit is lower both
because we have pushed the margin farther out and because, with more people
vaccinated, his risk of catching the disease is lower.
David Friedman
Professor of Law
Santa Clara University
ddfr@best.com
http://www.best.com/~ddfr/
Received on Thu Feb 19 03:04:38 1998
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