The Effect of a Placebo-based Policy

(Disclaimer: I don’t actually know that much about medical ethics or public policy, so I welcome all comments to educate me on the issues here. Also, I will miss citing things because I’m a lazy blogger, so I recommend that if you’re interested, you do your own research)

The Placebo Effect is a well-known phenomenon where a patient actually improves even when given a non-effective treatment that  he or she believes is effective. The perception of efficacy alone not only makes the patient feel better, but actually makes them better.

This effect manifests in other, similar manners, where the perception overrides the actual sensation. For example, it turns out that people will enjoy (and report as enjoying) wine more if it is marked as being more expensive, independent of the actual wine itself. Though maybe if you’re a hipster cheapskate like me, you might perceive cheaper as being better, like a hole-in-the-wall Chinese restaurant.

In both of these cases, the subject is being tricked into something, but the effect on them is real. Given that, the big question I have is: do you think it’s ethical for doctors, marketers, and other professionals to use the Placebo effect?

Big Yak Mountain, the book club I am in, just read Dan Ariely’s Predictably Irrational. Ariely is a behavioral economist at Duke, and in this book, he describes several quirks about human decision-making that show how irrational we are. He discusses how uncertain we are in valuing things, to the point where we don’t even know whether we should pay or be paid for some experience. He talks about the gulf between free versus really cheap. He explains why I would happily help you move a couch out of the goodness of my heart but would be unwilling to do it if you offered me $5. Overall, he covers roughly 15 different topics, one per chapter, in an accessible manner. Although I think that Thinking, Fast and Slow is still better, I can understand why you might want to save yourself a few hundred pages and explanation of experimental methods.

When I was putting together notes for the discussion, the question I kept coming back to was, “Is it okay that we’re so irrational, or shoulwe be more rational, more economically logical, in reasoning?” From our discussion, we roughly agreed that these phenomenon are fascinating and good to know, but we were also completely satisfied to experience our blissful irrationality as it is. The bigger question, however, is how this should impact policy, and this is where I am going to do the very bad thing of generalizing narrow experimental results into my worldview.

I asked one policy question above, and I have a few more for you along the same lines. Here’s an easy one: should the use of “free” in advertising campaigns be regulated? I think most of us would say no, despite the fact that we’re totally irrational about free and will go way out of our way to get a free bagel to a degree far beyond that of a 1 cent bagel, even if the free bagel is just a way to lure us into a store to make a large purchase.

Here’s a more contentious one. Ariely spends a chapter on how irrational we are when aroused. If you’re unfamiliar with the study, I’ll save the joy of the experimental methods for when you read the book, but the result is that we act less rationally when emotionally aroused. Since people can be emotionally aroused by anger, one policy is a “cooling off” period between the purchase and acquisition of a gun to prevent people from doing something rash. What do you think of cooling off periods?

The last one is quite broad, but a big issue today is government surveillance. It appears that the NSA has been spying on just about everyone to a much greater degree than we thought. I’m a trusting guy and believe that this was done for our own good and not because someone is reading my phone meta-data to hurt me. If we momentarily ignore the ethics of the surveillance itself, we have been deceived about the activity itself. This deception sounds a lot like the Placebo effect, where an authority gave the perception of something to make us feel better and improve our situation, though they were technically lying at the time. Given my biased framing, how do you feel about the government deceiving us about surveillance for our benefit?

I haven’t quite worked through the details and nuances of this, and specific issues deserve more thought, but I personally am pretty liberal (socially and economically), and I think my belief in human irrationality (and by inclusion, the placebo effect) plays a big role in that. Simply, I, like most other people in this country, am just one person who can’t adequately grasp what is ultimately good for me, and to some degree, I need someone (and not just market forces) to be watching my back.

I need financial regulations because I have no idea what the banks are doing. I need environmental regulations because I don’t know what every supplier is doing. And even if I could, I couldn’t resist buying the cheaper detergent to make optimal purchases. I believe in universal health care because choice is good, but it’s a lot ask every individual to know how best to keep themselves healthy. And assuming that Congress is well-informed (which apparently has not been true so far), I’m generally pretty okay with government surveillance because there are things that I’m better off not knowing, and I trust an entity with the goal of protecting me more than businesses with the goal of being profitable.

So my wildly extrapolated beliefs based in science suggest that a stronger hand in policy is good for us. Of course, there’s always the looming threat of totalitarianism, but a healthy debate and oversight from our legislature should keep it in check. At least in contrast to current trends in libertarianism and small government, I would like to see government stay involved. Some people believe that they deserve complete transparency, that markets are self-correcting, that government should be limited, and that individuals should have tremendous personal freedom. I definitely believe in personal freedom on social issues where it’s more obvious (to me) how freedom affect one’s happiness. On the other issues, my understanding of human cognition is that given complete information and choice, people can still be quite bad at ultimately making themselves happy. And I think that public policy has that mandate as well.

my idea:

Here’s an idea I had about a week ago while lying in bed, severely jet-lagged. I’m pretty sure that this is at least better than the “shower idea”.

Today, everyone is going crazy about Obama’s healthcare proposal. If you haven’t heard about it, I recommend that you not go to any town hall meetings. Anyways, I noticed there are a lot of statistics being thrown out there from both sides, including anything from the length of Canadian transplant waitlists to the estimated cost of insuring everyone, from the total number of uninsured Americans to the how much of a liar Obama is. Statistics are great to use because they sound official and concrete. Unfortunately, statistics can be misleading, or even downright lies. At best, quoted statistics are used with some bias.

What I propose is a website where one could get references and context for statistics. For example, let’s say that a commercial says “40% of all Americans will fake washing their hands if they think someone is watching” (I just made that up). Questioning this, they can go to and search for it. They can find the statistic (40%) and see who said this (commercial on public health), and what the apparent source is (Kevin Leung’s butt). Additionally, there would be a meter for the left and right bias of the speaker (neutral) and the original source (very left). Also, there would be a meter for the reliability of the quote, from the truth to maybe misleading, to a downright lie (in this case, a lie). I guess, then, that the stat, quoter, and quotee would all be judged on 2 axes, being political bias and reliability. Below that, they could see other statistics for comparison (70% of people will fake washing their hands if no one is watching) and comments from various users.

Of course, like any knowledge-based service, this depends on there being good, informed people who could give their opinions on the subject. All of the data would be user-driven, and I guess we could probably use the same 2 axes for each of the users. Thus, reliable, fairly moderate people would have more weight in evaluating new statistics. This, of course, leads to a bad chicken-egg problem between users and stats, but this is just an idea.

So, my disclaimer: I know nothing of this area. I don’t know if this has been done before. I don’t know anything about statistics or politics. I don’t know how well political forums online work, or if everyone out there just becomes a troll. Just an idea. Opinions?


There’s the common perception that techies are somewhat spacey, unaware of what’s actually going on in the world. When programmers spend their time building artificial creations in virtual spaces, sometimes it’s hard to find the connection to the plight of the unemployed, or international conflict.

Which might be a little true of me. My google reader is filled with techie stuff, and my desperate attempt to stay relevant includes morning news digests from MSNBC, NYT, and the Toronto Star by email, and a constant backlog of the New York Times that I end up reading at all once on the weekends. I at least pretend to be well-read by keeping a vanity stack of newspapers in my dorm room:

Regardless, when I saw that Pervez Musharraf, former President of Pakistan, would be speaking on-campus, I knew enough to know that this was a big deal. That might be just from watching CNN in China because I had nothing better to do at that time, but I think that counts.

Musharraf is a particularly interesting speaker to have because he’s not very popular with the western media or people. On-campus speakers often fit the ideal American persona, having made a significant contribution to society that everyone recognizes. On the other hand, I don’t know if I agree with everything Musharraf has done. He came to power in Pakistan under dubious circumstances and has removed political opponents from office. But I think that makes him very interesting to listen to.

A lot of others students agreed, apparently, and the line in White Plaza on the first day was definitely one of the longest I’ve seen on-campus:

Tickets to the event at Memorial Auditorium (seating 1600, according to Wikipedia) were gone before the end of the week, and on Friday afternoon, the building was definitely filled.

Musharraf started with about an hour long speech about terrorism and how to fight it. His stance on terrorism was long one of the important reasons why the American government supported him, and I certainly believe he’s earnest in his desire to end terrorism. He talked broadly about the causes of terrorism and extremism, often using Pakistan as an example. While I agreed with everything he said, I realized afterward that few wouldn’t. Talking at such a high level, he preached accepted morality and reasonable deductions on the topic. What I would have found potentially more interesting if he had talked more about what Bush would call the “tough decisions.” In the real world, everything isn’t perfect, and we have to make tradeoffs–even between natural rights and ethics–to achieve our highest goal. Musharraf has certainly appeared to give on political freedom to gain on stability, and I would have found it much more compelling (though only potentially convincing) had he spoken about that.

Following the speech was a 45-minute Q&A session moderated by a Stanford professor, which was much more interesting. There were generally 3 categories of questions:
1) Obscure. As I mentioned, I’m not really hot on the whole current events thing. Thus, when someone asks about the house arrest of some scientist selling nuclear designs or signing a document in 2007, I don’t actually know enough to understand the importance of his response. Regardless, I was certainly glad that there were a couple of these. When I saw Bill Gates and Stephen Hawking, I was disappointed because I don’t think anything they said was directed towards a knowledgable crowd. Maybe it means nothing to me, but I’m sure that there are IR and Poli Sci majors who were waiting for it.

2) Angry. Musharraf is controversial. Stanford students are pretty political. Thus, there are people who are very, very angry at him for things he’s done. While I can understand the ire of those asking accusational questions, I find the act somewhat self-serving. Maybe those individuals will feel better to yell at Musharraf to his face, but their emotions basically allow Musharraf to bat the question away as meaningless. While it’s cool that he’s here, we’re not the UN, and he’s under no obligation to answer these questions.

For example, one student asked him (paraphrased), “What percent of the Pakistani government and agencies, including military and intelligence, does the government actually have control over? And don’t say all of it, because that would undermine everything you’ve said today.” And an awesome answer. Musharraf: “Where are you from?” “India.” “I knew that.” After the laughter died down, Musharraf instead gave a short speech on how India and Pakistan need to stop hating and accept that the only way to move forward is for everyone to come together. Brilliantly political response, I thought.

3) Cheeseball. There were a couple cheeseball questions which Musharraf responded with some more generally good statements. Not interesting.

In the end, I don’t think I got anything from the appearance that I couldn’t have gotten from reading or watching press releases. Perhaps the real benefit for me was to have almost 2 hours to just think about what he was saying and do the good thing of paying attention to events, for once. Musharraf apparently is THE big speaker of the year for the series, but I hope we’ll have just as interesting people to make even spacey students like me think on something new for a little.