Rein in pandemic by pricing vaccine: Does social trust matter?

Upasak Das (upasak.das@manchester.ac.uk), Rupayan Pal, Udayan Rathore (rathore.udayan@gmail.com) and Bibhas Saha (b.c.saha@durham.ac.uk)
Additional contact information
Upasak Das: Global Development Institute, University of Manchester
Udayan Rathore: Oxford Policy Management
Bibhas Saha: Durham University Business School

Indira Gandhi Institute of Development Research, Mumbai Working Papers from Indira Gandhi Institute of Development Research, Mumbai, India

Abstract: In this paper, we explore the role of Generalized Social Trust (GST) in promoting public health during pandemics. We theorize and empirically test the effect of GST on individual's likelihood (LTP) and willingness to pay (WTP) for vaccines of different efficacy. Using survey data from Madhya Pradesh, India, which was collected just before the COVID-19 vaccine rollout in 2021, we find a positive role of GST in promoting LTP and WTP for different vaccine variants. Our identification strategy relies on exogeneous variation in out-group trust of neighbors of respondents as instrument variables. The findings are robust to multiple internal validity checks. Importantly, we find that when efficacy of the vaccine falls, the marginal effects of GST on LTP and WTP increase. The finding suggests that when an individual with higher GST faces a higher chance of infecting others through availability of lower efficacy vaccine, she is less likely to free ride and thus pay more at the margin.

Keywords: Social trust; Vaccine efficacy; COVID-19; Outer-group trust; Willingness to Pay (search for similar items in EconPapers)
JEL-codes: H23 H51 I12 I18 Z13 (search for similar items in EconPapers)
Pages: 48 pages
Date: 2023-06
New Economics Papers: this item is included in nep-dcm and nep-soc
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

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