COVID-19 crisis highlights Market Failures
The COVID-19 crisis highlights the failure of market mechanisms.
The lack of good health care in the USA will highlight how private medicine simply does not deliver the health care people need. The same can be said in Australia, though we still had a bit more public system to build on.
But medical research has also been decimated by the market model which judges the worth of research by how quickly it can be turned into a marketable product.
Treatments for malaria have been neglected for many years, because the people who get malaria are not very rich. But there are also few new antibiotics, because they take a lot of research and people only take antibiotics for a short time compared to blood pressure, cholesterol-lowering or arthritic drugs. So there is less research into antibiotics and anti-malarials, and it turns out vaccines also.
In 1999 a non-medical person, Peter Wills, did a review of medical research funding in Australia. CEDA (Committee for the Economic Development of Australia) still says on their website, ‘Peter Wills has been involved in property development and business management for over 40 years and is widely acknowledged as a prominent leader in the Australian property industry. In addition to his property experience, he has had an influential role in furthering Australia’s health and medical research sector’.
I have not been able to find a copy of his 1999 review, but it recommended a number of things. It was popular as it resulted in the doubling of support for medical research and the creation of Research Australia, a research and funding body. But as I recall, it also wanted to have research done in cooperation with the private sector with a view to profit sharing and using patents developed as a source of income. The problem with this concept is that the private sector ends up recruiting the well intentioned but somewhat naive publicly-funded research team to do research that they would have done anyway, and pocketing most of the profits.
The publicly funded research teams thus have their priorities set by those with a view to markets, rather than areas which might be more influenced by researcher or public interest.
I noted this at the time, as I was concerned that a person who made his money in the property and local government area was making recommendations about the long-term strategy of medical research in Australia, and was very much speaking about the market forces and he basked in the glory of the Howard government’s praise. It seems to me now that the extra funds also bought both gratitude and silence from the research establishment.
So I was interested to note that the lack of vaccine research is said to be due to market failure, and I wondered why the Wills Report of 1999 cannot be found on google. Naturally the long-term funding structures and strictures are not discussed.