If we don’t properly vaccinate the vulnerable people in our society against seasonal influenza (flu) epidemic, we face huge societal costs, according to new research by Dr Kenan Arifoglu from the UCL School of Management and Dr Christopher S. Tang from UCLA Anderson School of Management.

According to Assistant Professor Kenan Arifoglu

“People make their vaccination decision in a self-interested manner and ignore externalities that they impose on others’ well being. As a result, either less people seek vaccination so that more people are infected during the flu season, or people with high risk are rationed and become more likely to get infected.

“The supply of the flu vaccine is also hard to predict: the vaccine is produced via chicken eggs through a long and complex process, and we don’t know how many vaccine doses we will get from a chicken egg. This means there can be a limited supply of flu vaccines. It is vital that when the supply is limited, people who have high risk, such as the elderly should get it first in order to prevent widespread disruption.

“Because the flu is so contagious, governments should intervene and implement a two-sided incentive program. They should use vaccination tax or subsidy on the demand side to entice people to make their vaccination decisions accurately while, on the supply side, they should use a transfer payment (whose extent depends on the vaccine supply) to entice the manufacturer to make the right production decision.

“As the seasonal flu epidemic occurs every year, the budget of such a two-sided incentive program will balance itself out, and won’t require external funding, meaning it won’t cost the government anything.”

The researchers believe that if governments can implement such two-sided policies which balance the supply and demand mismatches, and entice people and the manufacturer to make the right decision, they can reduce the substantial economic impact of seasonal influenza epidemic on society.

For more information, a copy of the paper, or to speak to Assistant Professor Kenan Arifoglu, contact Kate Mowbray at BlueSky PR on [email protected] or call +44 (0)1582 790 711.