When it (literally) pays to get vaccinated

Should you get vaccinated because it protects you from getting sick, or because it pays a hundred bucks?

As the world chugs toward recovery from the Covid-19 pandemic, financial incentives are being showered on citizens everywhere to speed up the vaccination drive. Maryland is paying state employees $100 to get vaccinated. Maine is purchasing fishing licenses for citizens. Several states are offering lotteries of up to $1.5 million, and a university in Michigan is even raffling off full-ride scholarships to students.

The prizes could be the decisive nudge for those who were on the fence about getting vaccinated, or so-called “free-riders” who were waiting to see what negative side effects may emerge in others before getting the jab themselves.

Other than cash, rewards could also be free tickets to the movies or amusement parks, which serves a double purpose in helping hard-hit business sectors recover. The economic costs of an ongoing pandemic far outweigh the costs of these incentives, too, so governments and corporations are more than willing to bankroll them.

But the relationship is not so straightforward, and can be counterproductive and even harmful. Market interventions distort people’s motives. Some who were already planning to get the vaccine may hold out and wait to see if there are even more attractive offers. Those who have had the jab may learn that if you wait, you’ll get a better deal next time.

And while governments have to make vaccines free in the interest of equity and human rights, why should they pay you to get them if they are supposedly so good for you? Imagine you were planning to eat a vitamin to boost your immune system, but now someone is offering to pay you to do it. You may start to wonder why: Is it because there is some risk to it, say discomfort or even a severe reaction that leads to death?

In fact, a new study by the National Bureau of Economic Research showed that financial incentives and other nudges didn’t have a noticeable impact on vaccination rates among the vaccine hesitant. In some subgroups, particularly among Trump supporters over 40-years-old, financial incentives actually decreased vaccination rates. Thus financial incentives can inadvertently devalue the vaccine and make people even more suspicious of the newly developed product.

After a while, governments around the world and in the U.S. began to push negative economic incentives for people to get the jab. Just this month, the Biden administration set Jan. 4, 2022, as the deadline for large companies to mandate Covid-19 vaccinations or start weekly testing for employees in an emergency rule. Though some companies will pay for employees’ testing, others may not. Testing is not only annoying and time-consuming but expensive, providing a strong financial incentive for some to get vaccinated. At other companies, employees face dismissal if they don’t get the shot.

Some call this coercion and, on the extreme end, exploitation, especially for those who are financially desperate, for those whose jobs and livelihoods are at stake. Even positive incentives could become coercion if the size of the reward is too big, as at what point does that strip a person’s judgement of autonomy?

In liberal societies, coercion is only justified when it can prevent harm to others. Given that the pandemic and the vaccination drive needed to end it are public health issues, and given that financial incentives have proven they are not sufficient and can instead distort people’s motives, perhaps outright government mandates, employee rules and other hard policies may be more effective. But I’ll leave that to a politics blog.