Governments around the world are experimenting with various incentives such as cash and free beer to encourage vaccinations against COVID-19. This episode explores what an optimal incentive could look like.
Economist Isaac Katz discusses his proposed vaccination incentives with Economics Explored host Gene Tunny. You can read all about it in Isaac's discussion paper Incentives for achieving COVID 19 herd immunity through vaccination.
Key features of Isaac's plan are:
1. Rewards (incentives) could be in the form of payments to each vaccinated individual, and eligibility to win a significant lottery prize and smaller prizes. We will discuss shortly how these rewards should be designed and who pays for them.
2. The incentives would only be payable if a specified national vaccination rate is met by a specified due date. Incentives would not be paid prior to the due date. This approach creates a focus on the objective – which is to maximise the national vaccination rate. Rewarding individuals for being vaccinated without recognising the national objective will fail to promote community based actions to increase vaccination rates (which we will discuss later).
About this episode's guest
Isaac Katz is a Director of Harding Katz Pty Ltd, a small consulting practice based in Melbourne specialising in utility regulation, energy market reform, business strategy and applied economics.
Isaac was previously a Senior Manager with Cap Gemini Ernst & Young in Melbourne from October 1997 to September 2001. He has provided economic and regulatory advice to regulators, Government and regulated businesses on a wide range of strategy and policy issues.
Prior to moving to Australia, Isaac worked as a senior economic assistant for the UK electricity regulator (now Ofgem); and as a pool price analyst for a regional electricity company. Isaac also worked as an economist for Railtrack plc, focusing on aspects of the regulatory framework prior to and immediately after privatisation.
Isaac has a Master of Arts, Economics, from Cambridge University and a Master of Science, Business Economics, from Strathclyde University.
Links related to the conversations include: