Tuesday , September 29 2020
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How strong is the paternalist argument for drug regulations?

Summary:
We are often told that we cannot leave the pharmaceutical market unregulated, as uninformed consumers will make poor choices. I don’t doubt that there would be many examples of poor choices in a free market, but that’s not the same as claiming that the choices would be poor, on average. This article caught my eye: Nearly 200 covid-19 vaccines are in development and some three dozen are at various stages of human testing. But in what appears to be the first “citizen science” vaccine initiative, Estep and at least 20 other researchers, technologists, or science enthusiasts, many connected to Harvard University and MIT, have volunteered as lab rats for a do-it-yourself inoculation against the coronavirus. They say it’s their only chance to become immune without

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We are often told that we cannot leave the pharmaceutical market unregulated, as uninformed consumers will make poor choices. I don’t doubt that there would be many examples of poor choices in a free market, but that’s not the same as claiming that the choices would be poor, on average.

This article caught my eye:

Nearly 200 covid-19 vaccines are in development and some three dozen are at various stages of human testing. But in what appears to be the first “citizen science” vaccine initiative, Estep and at least 20 other researchers, technologists, or science enthusiasts, many connected to Harvard University and MIT, have volunteered as lab rats for a do-it-yourself inoculation against the coronavirus. They say it’s their only chance to become immune without waiting a year or more for a vaccine to be formally approved.

Among those who’ve taken the DIY vaccine is George Church, the celebrity geneticist at Harvard University, who took two doses a week apart earlier this month. The doses were dropped in his mailbox and he mixed the ingredients himself.

Church believes the vaccine designed by Estep, his former graduate student at Harvard and one of his proteges, is extremely safe. “I think we are at much bigger risk from covid considering how many ways you can get it, and how highly variable the consequences are,” says Church, who says he has not stepped outside of his house in five months.

Before going any further, let me emphasize that I have zero knowledge as to whether this is a good idea, and I don’t plan to discuss this vaccine.  The effectiveness of this vaccine has no bearing on this post.

Instead, I’m going to claim that the people taking this vaccine are relatively bright and welli nformed on the subject.  These are not the sort of people whom the FDA was set up to protect from making foolish decisions about their own healthcare.  The “uninformed consumer” rationale for regulation does not apply to them, even if, ex post, their decision turns out to have been a mistake.

There are costs and benefits to taking unapproved vaccines.  Given that fact, there’s a question as to whether the FDA should allow but discourage vaccines still in development (as they do with certain approved drugs like hydroxychloroquine) or ban them outright, as they do with drugs or vaccines not formally approved for any use.

Reading this article on the Harvard and MIT scientists self-vaccinating makes me wonder if the FDA’s official policy is actually the policy that maximizes expected utility.

If I were told tomorrow that I had lung cancer, my next question would not be, “What do you recommend I do?”  Instead my question would be, “What do the majority of cancer doctors do when they themselves are faced with a similar diagnosis.”  Based on what I’ve read, the answer to these two questions would be quite different.

Scott Sumner
Scott B. Sumner is Research Fellow at the Independent Institute, the Director of the Program on Monetary Policy at the Mercatus Center at George Mason University and an economist who teaches at Bentley University in Waltham, Massachusetts. His economics blog, The Money Illusion, popularized the idea of nominal GDP targeting, which says that the Fed should target nominal GDP—i.e., real GDP growth plus the rate of inflation—to better "induce the correct level of business investment". In May 2012, Chicago Fed President Charles L. Evans became the first sitting member of the Federal Open Market Committee (FOMC) to endorse the idea.

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