Should it stay, or swerve? Trading off lives in dilemma situations involving autonomous cars.

Using a representative survey with 1317 individuals and 12,815 moral decisions, we elicit Swedish citizens' preferences on how algorithms for self-driving cars should be programmed in cases of unavoidable harm to humans. Participants' choices in different dilemma situations (treatments) show that, at the margin, the average respondent values the lives of passengers and pedestrians equally when both groups are homogeneous and no group is to blame for the dilemma. In comparison, the respondent values the lives of passengers more when the pedestrians violate a social norm, and less when the pedestrians are children. Furthermore, we explain why the average respondent in the control treatment needs to be compensated with two to six passengers spared in order to sacrifice the first pedestrian, even though she values the lives of passengers and pedestrians equally at the margin. We conclude that respondents' choices are highly contextual and consider the age of the persons involved and whether these persons have complied with social norms.

To Vaccinate or to Procrastinate? That is the Prevention Question.

Invoking Yaari's dual theory, we develop a model of individual vaccination decisions that incorporates quasi-hyperbolic discounting, risk aversion, and information. We test the resulting hypotheses for the flu season 2010/2011 using a representative German data set. We find a significant impact of time preferences on immunization decisions. The impact of the discount factor is significantly negative for exponential discounters. While present-biased individuals' demand for vaccination is not statistically different from the one of exponential discounters, future-biased individuals have a significantly higher probability to vaccinate. Stratification by gender reveals that these effects are entirely driven by men. That is, time preferences have no explanatory power for the vaccination decisions of women. This also applies to risk aversion, where more risk aversion implies a significantly higher probability to vaccinate for men but not women. All information measures turn out significant. Well-informed individuals have a much higher propensity to vaccinate than poorly informed individuals. If policy makers aim at improving immunization rates, then our results suggest that public policy should concentrate on providing easily accessible and concise information on the flu and the flu shot. Our results on time preferences and risk preferences imply a rather inactive role for public policy. Copyright © 2015 John Wiley & Sons, Ltd.

Earmarking and the political support of fat taxes.

An unhealthy good causes health issues in the long run. It creates a misperceived utility loss and increases health care costs. Conversely, a healthy good provides misperceived utility gains and reduces health care costs. Individuals differ in income and in their degree of misperception; they vote over a fat tax according to their misperceived utility. A fraction of the tax proceeds is "earmarked" to reduce health insurance premiums; the remainder finances a subsidy on the healthy good. This earmarking rule is determined to maximize welfare, anticipating the induced political equilibrium. The equilibrium fat tax is always lower than the utilitarian level. This is not necessarily true with a Rawlsian objective. The determination of the earmarking rule is complex. Even in the utilitarian case, it is not just used to boost political support for the fat tax. Instead, it may involve a tradeoff between fat tax and healthy good subsidy.

Financing and funding health care: Optimal policy and political implementability.

Health care financing and funding are usually analyzed in isolation. This paper combines the corresponding strands of the literature and thereby advances our understanding of the important interaction between them. We investigate the impact of three modes of health care financing, namely, optimal income taxation, proportional income taxation, and insurance premiums, on optimal provider payment and on the political implementability of optimal policies under majority voting. Considering a standard multi-task agency framework we show that optimal health care policies will generally differ across financing regimes when the health authority has redistributive concerns. We show that health care financing also has a bearing on the political implementability of optimal health care policies. Our results demonstrate that an isolated analysis of (optimal) provider payment rests on very strong assumptions regarding both the financing of health care and the redistributive preferences of the health authority.

Premium subsidies and social health insurance: substitutes or complements?

Premium subsidies have been advocated as an alternative to social health insurance. These subsidies are paid if expenditure on health insurance exceeds a given share of income. In this paper, we examine whether this approach is superior to social health insurance from a welfare perspective. We show that the results crucially depend on the correlation of health and productivity. For a positive correlation, we find that combining premium subsidies with social health insurance is the optimal policy.