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Sept. 1, 2021, 12:56 p.m. EDT

With more than 1,300 Americans dying each day from COVID, experts say penalizing the unvaccinated works better than incentives

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Charles Passy

It seems as if there’s nothing that companies and government officials won’t do to convince unvaccinated Americans to finally get their COVID-19 shot. Krispy Kreme recently announced that it is doubling its doughnut-a-day offer . New York City Mayor Bill de Blasio is offering free Avengers comic books to persuade the teen set.

But at a time when coronavirus cases and deaths are increasing because of the delta variant, some are suggesting it might be time to try the reverse approach. As in penalizing the unvaccinated.

According to the New York Times tracker , 1,346 Americans are dying each day from the virus, an increase of 93% over two weeks ago. Case counts are also up — to more than 160,000 daily, an average increase of 14% over the past two weeks.

Delta Air Lines is going the penalty route, with its new policy of imposing a $200 monthly surcharge on unvaccinated employees. Ed Bastian, the airline’s chief executive, said the surcharge is “necessary to address the financial risk the decision to not vaccinate is creating for our company.” Bastian noted that if an employee infected with COVID-19 has to be hospitalized, it can cost the airline up to $50,000.

Of course, Delta /zigman2/quotes/200327741/composite DAL +0.51% could have opted to give workers a financial reward as an incentive to get the vaccine. But in going the stick-over-carrot approach, the company is essentially upholding an economic behavioral principle, dubbed loss aversion , that says people are more likely to respond to the pain of loss over the joy of gain.

Fear of loss can indeed be a powerful motivator. In Delta’s case, Peter Carter, the company’s vice president and chief legal officer, told Bloomberg Law that the airline has seen a five-fold increase in the number of workers getting the vaccine — from 11 in one day to 55 — since it announced the $200 surcharge.

“If this surcharge results in one person getting vaccinated, we feel wonderful about it, because we know that that will save lives,” Carter said.

Delta isn’t the only one buying into this approach. The National Football League, for example, has warned that teams could be at risk of forfeiting games if players go unvaccinated.

Still, experts in behavioral economics warn that the calculus of determining what’s more effective — rewards or penalties — is complex.

Frederick Chen, an economics professor at Wake Forest University who has studied loss aversion as it relates to the flu vaccine, said lots of variables must be taken into consideration.

There’s no question that offering $1 million or even $1,000 might convince some individuals to get vaccinated against COVID-19, he said. At the same time, such rewards are probably not practical from a financial standpoint, he added.

How effective are rewards in convincing people to get vaccinated?

Meanwhile, rewards that are smaller or fail to offer a guaranteed payoff don’t seem to be all that effective in increasing vaccination rates. Chen cited the lottery programs that some states put into place , which offered vaccinated individuals tickets with prizes as high as $1 million. The programs didn’t really resonate, he said, because people recognized the likelihood they wouldn’t win the big prize.

Hence, we may be at a time when penalties make more sense when it comes to the COVID-19 vaccine. “It’s hard to significantly increase the benefit in a way that doesn’t cost too much money,” Chen said.

But there’s also the question of whether penalizing people makes them more stuck in their ways. Think of the child who becomes only angrier the more he or she is punished. Indeed, there’s a whole criminal-justice theory, called defiance theory , that suggests just such an outcome.

It’s also worth noting that the penalties don’t have to come just in the form of company surcharges. Unvaccinated Americans now face a range of “prices” they may pay , from losing their jobs to losing friends.

Gina Giacomantonio, a publicist based in New York, finally got the COVID-19 vaccine recently after long hesitating because of what she called “fear of the unknown.” She said she was motivated by a possible “penalty” of a different sort: She was concerned about her elderly father, whom she sees on a regular basis, and couldn’t bear the thought of possibly passing the virus on to him.

As for Krispy Kreme being an incentive, Giacomantonio said it meant nothing to her. “I’m not going to take a vaccine because someone is giving me a free doughnut,” she said.

Related: More U.S. companies appear to be mulling surcharges for unvaccinated employees

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Oct. 26, 2021 4:00p
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