The ‘endowment effect’ and fear of losing have powerful impact on our choices
Vaccine incentives have been powerful drivers of vaccination rates around the country since the state of Ohio made the news with their Vax-a-Million campaign in mid-May.
Behavioral Economist, Katy Milkman, explains that the success of vaccine lotteries boils down to two key components: heavy media coverage and individuals believing their odds of winning are higher than the reality. In this brief interview with NPR, Milkman highlighted a few psychological phenomenon to keep in mind when creating public messaging campaigns:
The first is the “endowment effect,” a psycho-behavioral tendency first published by economist Richard Thaler. The endowment effect refers to the value that we place on our possessions: we want to hold on to them, and we have a tendency to overestimate their relative market value. The endowment effect is at the heart of why motivating messages contain language like: “A vaccine is waiting for you…”
We don’t like the idea of missing out.
Our human tendency to be loss-aversive explains the success of what’s-called “regret lotteries.” Kevin Volpe and his group at the Center for Health Incentives and Behavioral Economics at University of Pennsylvania have evaluated the success of regret lotteries and suggested that these can be highly motivating and drive behavioral outcomes (Source: NPR).
Interested in launching a regret lottery? Here’s how:
While regret lotteries may not persuade the minority considered adamantly opposed to vaccination, they can impact the decision-making of the “movable middle.”
Curious how others might be integrating this science into public outreach campaigns?