Experimental study of consumer responses to different sources of information about prescription drugs

Jacob P. Byl and W Viscusi

Journal of Economic Behavior & Organization, 2021, vol. 186, issue C, 754-771

Abstract: Consumers receive risk information about prescription drugs from many sources, including from largely unregulated attorney advertisements. This experiment measures subjective risk beliefs about prescription drugs and subjects’ drug-taking behavior in an incentivized setting. Results of the experiment are used to estimate a Bayesian learning model to ascertain the risk levels implied by different information sources and the informational weights subjects place on these sources. Even after people have received scientifically based drug risk information from a doctor and product label, attorney litigation advertising boosts risk beliefs about side effects by an average of 16 out of 100 cases, which is roughly a 50% increase over baseline risk beliefs. Risk beliefs have a significant effect on drug-taking behavior in an incentivized environment. Experience with taking the drug also feeds back into the learning process about risk beliefs. Our experimental results help formalize how consumers update risk beliefs and suggest ways to encourage a learning environment that avoids alarmist updating based on information sources like attorney advertising.

Keywords: Risk updating; Experimental; Bayesian learning; Attorney advertising; Litigation advertising; Direct-to-consumer advertising; Prescription drugs (search for similar items in EconPapers)
JEL-codes: D12 D81 D90 I12 I18 K2 (search for similar items in EconPapers)
Date: 2021
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
http://www.sciencedirect.com/science/article/pii/S0167268120303991
Full text for ScienceDirect subscribers only

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:eee:jeborg:v:186:y:2021:i:c:p:754-771

DOI: 10.1016/j.jebo.2020.10.025

Access Statistics for this article

Journal of Economic Behavior & Organization is currently edited by Houser, D. and Puzzello, D.

More articles in Journal of Economic Behavior & Organization from Elsevier
Bibliographic data for series maintained by Catherine Liu ().