Market Failure and Mass Vaccination
Conventional economic theory unambiguously supports the privatisation of the health sector. It is premised on the notion that the market will be the best to understand dominant health concerns, and distribute medication and health care — both at market appropriate prices, and at adequate supply. Yet there is one aspect of health care, that the private sector has categorically failed — disease mitigation and eradication. Global efforts against spread of disease, championed by the WHO, have routinely involved heavy government and social intervention — both in terms of outreach and pricing.
Amongst the several failed government interventions in India, one has constantly stood apart — India’s polio eradication campaign. This case study shall be examined in this essay.
Understanding the Market Failure
Firstly, free-market macroeconomic principles pivot around one word — equilibrium. The market is most efficient at equilibrium, and production is at its maximum — for beyond this point, either the supplier or the consumer is effected. This means there shall always remain a market tolerable poor social outcome. A tolerable amount of national poverty, and a tolerable number of casualties in epidemics. In other words, since the market never seeks complete eradication or removal of a certain category, because the equilibrium often lies before that, nothing can truly be removed through market forces. A classic example of this is crime rates — as crime rates go down, it becomes more and more expensive to push them down further. An efficient market would tolerate a minimal amount of crime, which by itself poses lesser costs than its eradication. But this becomes particularly ineffective for disease eradication.
Secondly, mass public health programs generate tremendous positive externalities that are not registered in the market — like that of providing a safer environment for those not vaccinated. When such an externality is not registered, the good is under-produced and under-consumed — making it inefficient. When such an externality is tremendous, as in the polio eradication campaign, this inefficiency begins to constitute a market failure.
Polio Eradication in India — Evidence of Intervention Success
Polio is a virus that is transmitted through food and water contamination, and can lead to paralysis and death. It predominantly effects tropical countries without proper medical infrastructure, and thus poses a serious threat to any developing nation. It occurs predominantly in rural and low income areas, where there are both more children, due to larger families, and poor medical infrastructure.
Private sector contribution towards mass vaccination has always been low in India. Much of this occurs due to lack of citizen awareness, which results in low demand for vaccinations. However, even when the government initiated the polio-eradication movement, and called-upon the private sector for aid, given its more efficient distribution mechanisms, the sector still showed dismal performance. The private sector undertook only 7.5% of all vaccinations across the nation. This number is in fact the highest contribution the private sector has ever made to vaccination (second highest being 4.7% for tuberculosis). Furthermore, distribution was restricted to people in high income urban settings, who were under less threat to begin with.
Nature of Government Intervention
When examined through the eight-fold policy framework, one can categorise the polio-eradication campaign to be that of the ‘Do it yourself’ model, where the government acted both as a market player, by directly accessing consumers, and as a regulator.
The degree of government intervention was extraordinary- cities were divided into blocks and then streets, and micro maps of isolated regions were developed and analysed. Vaccination centres were placed even in railway stations, and religious leaders were called upon to fight against resistance to inoculation. The government led intervention, soon became a large-scale social intervention as well, with numerous volunteers and supporters. Vaccines were either subsidised or made free, and research to improve strains that proved ineffective, too were encouraged.
The result was an over-populated, underdeveloped and poverty-stricken nation declaring polio eradication in record time. It set up a model for several other nations, for disease mitigation and mobilisation management.
However, one may argue that this isn’t a government intervention at all, since it isn’t similar to other interventions — bans, tax disincentives and subsidies. But at its core, it remains one — for it addresses a long-standing public health issue that was aggravated by a market failure. It also helped lay foundation to one of the core requirements of a free-market — perfect information, as the campaign pivoted around educating the population about vaccines.
As seen repeatedly, public health is a sector the government regularly intervenes in — and often poorly. But an intervention of such a scale as this is heartening and provides perspective to the nature of government and social intervention — especially when market forces fail to do the job.
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BIBLIOGRAPHY
- Abhishek Sharma, Warren A Kaplan, Maulik Chokshi, Sanjay P Zodpey, Role of the private sector in vaccination service delivery in India: evidence from private-sector vaccine sales data, 2009–12, Health Policy and Planning, Volume 31, Issue 7, September 2016, Pages 884–896,
- “India’s Successful Polio Campaign a Model for Other Countries.” Public Radio International., 2019. https://www.pri.org/stories/2014-02-03/indias-successful-polio-campaign-model-other-countries.
- Lahariya, Chandrakant. “A brief history of vaccines & vaccination in India.” The Indian journal of medical research vol. 139,4 (2014): 491–511.
- “Polio — Symptoms & Causes.” Mayo Clinic. December 09, 2017, 2019. https://www.mayoclinic.org/diseases-conditions/polio/symptoms-causes/syc-20376512.
- “World Health Organization, Against All Odds, India Set to Make History Yet Again.” World Health Organization. August 10, 2018. Accessed June 28, 2019. http://www.searo.who.int/india/topics/measles/MR-campaign-web-success-story/en/.
