Costly Placebo Works Better Than Cheap One

Given two pills, one that costs ten cents and the other that cost $2.50, with both being simple sugar pills with no possible medical benefit, the more expensive pill works better to ameliorate certain conditions. I’m sure that the pharmaceutical companies will like this!

Durham, NC — A 10-cent pill doesn’t kill pain as well as a $2.50 pill, even when they are identical placebos, according to a provocative study by Dan Ariely, a behavioral economist at Duke University.”Physicians want to think it’s the medicine and not their enthusiasm about a particular drug that makes a drug more therapeutically effective, but now we really have to worry about the nuances of interaction between patients and physicians,” said Ariely, whose findings appear as a letter in the March 5 edition of the Journal of the American Medical Association.Ariely and a team of collaborators at the Massachusetts Institute of Technology used a standard protocol for administering light electric shock to participants’ wrists to measure their subjective rating of pain. The 82 study subjects were tested before getting the placebo and after. Half the participants were given a brochure describing the pill as a newly-approved pain-killer which cost $2.50 per dose and half were given a brochure describing it as marked down to 10 cents, without saying why.In the full-price group, 85 percent of subjects experienced a reduction in pain after taking the placebo. In the low-price group, 61 percent said the pain was less.The finding, from a relatively small and simplified experiment, points to a host of larger questions, Ariely said.The results fit with existing data about how people perceive quality and how they anticipate therapeutic effects, he said. But what’s interesting is the combination of the price-sensitive consumer expectation with the well-known placebo effect of being told a pill works. “The placebo effect is one of the most fascinating, least harnessed forces in the universe,” Ariely said.Ariely wonders if prescription medications should offer cues from packaging, rather than coming in indistinguishable brown bottles. “And how do we give people cheaper medication, or a generic, without them thinking it won’t work?” he asks.At the very least, doctors should be able to use their enthusiasm for a medication as part of the therapy, Ariely said. “They have a huge potential to use these quality cues to be more effective.”[source]

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7 thoughts on “Costly Placebo Works Better Than Cheap One

  1. This should not be news. I remember years ago a story about a software company that began lowering the price of its software. Up until a certain point, sales increased. After the software reached a certain level of cheapness, sales declined. This seems to be to be a different manifestation of the same phenomenon: perceived value.

  2. Same thing happens with wine. The more expensive the bottle, the better it tastes – even if both come from the same source. To the the average wine drinker. Some afficionados can tell the difference.

  3. Yes, the bigger the placebo, the bigger the imagined effect. I’ll quote from Dr Ben Goldacre:We know from research that four placebo sugar pills a day are more effective than two … we know that salt water injections are a more effective treatment for pain than sugar pills, not because salt water injections are medically active, but because injections are a more dramatic interventionand the more elaborate placebo ritual was more effective than the simple placebo tablet.

  4. It probably works the same way with newer drugs over older drugs (which also tend to be less expensive). Pharmaceutical companies have been making money this way for ages.

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