Herd immunity at what price? Using auctions to estimate what university students must be paid to get the flu vaccine.

There is significant resistance to vaccinations. Fewer than half of adults get a flu shot in the United States in a typical year, and a large minority of Americans say they will not get vaccinated against COVID-19. This resistance to vaccines creates challenges for both public health and the economy. The academic literature needs to consider potential policy solutions that might increase vaccination rates. In this study, we use experimental auctions to estimate how much university students need to be paid in exchange for agreeing to get a flu shot. These were real auctions where winners received compensation to get the flu shot. As found in prior research, the perceived stakes of such auctions incentivize participants to estimate the price at which they would engage in the auctioned behavior - in this instance, receiving a flu shot. We find that 50% require less than $1, and an additional 30% would get vaccinated for a payment of $20 or less. We also use a tobit regression to estimate bids as a function of participants' demographic characteristics. If low levels of compensation increase vaccination rates, this has significant public health implications. The government may be able to achieve higher vaccination rates at a relatively low cost, particularly in comparison with the economic harms caused by illness. This study demonstrates that experimental auctions may be useful for estimating how much a larger, more representative sample would need to be paid in exchange for agreeing to receive flu or COVID-19 vaccinations.

Estimating the price elasticity of demand for JUUL E-cigarettes among teens.

BACKGROUND: The widespread popularity of e-cigarettes, particularly JUUL, has led to an alarming increase in teen nicotine use, reversing a 40-year trend. One key question is how sensitive teens' demand for JUUL is to changes in price. METHODS: We estimate the price elasticity of demand using results from an experimental auction where teen nicotine users and nonusers bid on a JUUL kit. RESULTS: We find that a 10 % increase in price leads to as much as a 24 % reduction in JUUL demand among teens using nicotine, and as much as a 45 % reduction among teens not currently using nicotine. The teens in our study were more price sensitive than older adults who took part in a similar earlier study. CONCLUSIONS: From a public health standpoint, these are promising results. High e-cigarette taxes may dissuade relatively few older adult cigarette smokers from switching to e-cigarettes, but at the same time be highly effective at preventing teens from becoming e-cigarette users in the first place.

Going Once, Going Twice: Using Willingness-to-Accept Auctions to Promote Smoking Cessation.

INTRODUCTION: Incentive-based smoking cessation interventions increase quit rates. The optimal incentive, however, is unknown. We used a willingness-to-accept (WTA) auction where smokers submitted bids indicating the incentive they would need to receive for 1 week of smoking cessation. AIMS AND METHODS: Smokers ready to quit (n = 35) participated in a WTA auction, naming the amount they needed to be paid to quit for 1 week. Auction winners received an incentive if they successfully quit. All smokers received nicotine replacement therapy and self-help cessation materials. Carbon monoxide concentrations were monitored remotely three times during the week and in person at the final session. RESULTS: Participants who smoked their first cigarette within 5 min of waking demanded a significantly larger incentive in exchange for quitting than those who waited (p < .05). About 45% of auction winners quit smoking compared to 20% of nonwinners (p < .05). The cost per quit was $466 among auction winners compared to $894 among nonwinners. CONCLUSIONS: WTA auctions may be an effective way to determine the amount smokers need to be paid to quit, which would allow researchers to estimate the most cost-effective payment to offer as part of incentive-based smoking cessation programs. Replication evaluating longer-term cessation outcomes with larger samples is warranted. IMPLICATIONS: Incentive-based smoking cessation interventions increase quit rates. However, the optimal incentive is unknown. We found that a WTA auction is a feasible technique for estimating the amount smokers need to be paid to quit. Incentives are a surprisingly cost-effective way to facilitate smoking cessation because they are only paid to those who successfully quit. WTA auctions are a promising tool for determining the incentive that strikes the optimal balance between being large enough to motivate cessation, but small enough that it can be offered to the largest possible population of smokers for a given program budget.

Which smokers adopt e-cigarettes and at what price? An experimental estimation of price elasticity of demand and factors correlated with e-cigarette adoption.

E-cigarette use has surged in recent years. Many of these new users are cigarette smokers. It is unclear whether e-cigarette adoption by smokers will lead to improved public health due to uncertainty about whether e-cigarettes help smokers quit using cigarettes and about whether ongoing dual use reduces exposure to toxins. A third source of uncertainty is whether providing cigarette smokers with sample e-cigarettes increases e-cigarette adoption. To provide insight into this final issue, we follow up with cigarette smokers who left an experimental auction with an e-cigarette, contacting them after two weeks, six weeks, and six months to determine which demographic and smoking-related characteristics predict continued e-cigarette use. We find that smokers who have made a serious quit attempt, have been advised to quit smoking, or have previously tried e-cigarettes are significantly more likely to report continued e-cigarette use. Women and smokers from racial and ethnic minority groups are significantly less likely to use e-cigarettes at follow up, as are those who said they would rather quit than switch to e-cigarettes. We also use experimental auction bids to estimate the price elasticity of demand for e-cigarettes, finding that a 10% increase in price results in a 5.6% reduction in quantity demanded. This suggests e-cigarette demand is less price sensitive than some earlier studies have found. While a tax on e-cigarettes can still be an effective tool for reducing e-cigarette demand, the reduction in demand may be smaller than some earlier studies would suggest.

How much is social media worth? Estimating the value of Facebook by paying users to stop using it.

Facebook, the online social network, has more than 2 billion global users. Because those users do not pay for the service, its benefits are hard to measure. We report the results of a series of three non-hypothetical auction experiments where winners are paid to deactivate their Facebook accounts for up to one year. Though the populations sampled and the auction design differ across the experiments, we consistently find the average Facebook user would require more than $1000 to deactivate their account for one year. While the measurable impact Facebook and other free online services have on the economy may be small, our results show that the benefits these services provide for their users are large.

Does Winning an Experimental Auction Change People's Behavior? An Application to E-cigarettes.

Experimental auctions allow researchers to estimate demand for products like e-cigarettes in a non-hypothetical environment where participants face real and immediate consequences for their bids. However, because auction winners actually purchase the product they bid on, participants may be introduced to a product they otherwise would not have discovered. Based on an experimental auction where 432 participants bid to buy e-cigarettes, we found that auction winners are significantly more likely to be using e-cigarettes two weeks, six weeks, and six months after the study but are no less likely to be daily cigarette smokers. This result holds even after controlling for prior e-cigarette use, strength of participants' initial demand for e-cigarettes, and demographic characteristics.

Using Experimental Auctions to Examine Demand for E-Cigarettes.

BACKGROUND: E-cigarettes are the latest in a line of potentially reduced exposure products that have garnered interest among smokers. METHODS: In this paper, we use experimental auctions to estimate smokers' demand for e-cigarettes and to assess the impact of advertisements on willingness to pay. These are actual auctions, with winners and losers, which means hypothetical biases often seen in surveys are minimized. RESULTS: We find smokers have positive demand for e-cigarettes, and that the print advertisements used in our study had greater effectiveness than video ads (b = 2.00, p < .05) in terms of increasing demand for disposable e-cigarettes. Demand was greater for reusable versus disposable e-cigarettes. In multivariate models, demand for e-cigarettes was higher among non-white participants and among smokers willing to pay more for cigarettes. CONCLUSIONS: Our findings suggest that cigarette smokers are interested in e-cigarettes as alternatives to traditional products, particularly for reusable forms, and that this demand can be influenced by messaging/advertising. IMPLICATIONS: Given these reduced harm products are appealing, if smokers are able to switch completely to e-cigarettes, there is a good chance for accrual of significant harm reduction.

Estimating the impact of pictorial health warnings and "plain" cigarette packaging: evidence from experimental auctions among adult smokers in the United States.

OBJECTIVE: To estimate differences in demand for cigarette packages with different packaging and health warning label formats. METHODS: Adult smokers (n=404) in four states participated in experimental auctions. Participants bid on two of four experimental conditions, each involving a different health warning label format but with the same warning message: (1) text on 50% of pack side; (2) text on 50% of the pack front and back; (3) text with a graphic picture on 50% of the pack front and back; and (4) same as previous format, but without brand imagery. RESULTS: Mean bids decreased across conditions (1: $3.52; 2: $3.43; 3: $3.11; 4: $2.93). Bivariate and multivariate random effects models indicated that there was no statistically significant difference in demand for packs with either of the two text only warnings; however, demand was significantly lower for both packs with prominent pictorial warnings, with the lowest demand associated with the plain, unbranded pack. CONCLUSIONS: Results suggest that prominent health warnings with graphic pictures will reduce demand for cigarettes. Regulators should not only consider this type of warning label, but also plain packaging policies for tobacco products.