Valuing the Unseen

Last year, Freakonomics Radio had an episode about the impact of important medical technologies. At one point, they’re discussing two discoveries that revolutionized medicine.

The first was anesthesia.

The second was sterilizing equipment to stop the spread of germs.

One was adopted immediately — it spread like wildfire through the medical community. The other took a decade or more to become accepted. And the reason for the difference is while both were incredibly effective, only one was effective in a visible way. (If you don’t get sick because someone cleaned their equipment, the cause and effect relationship is much harder for us to notice.)

I learned years ago working as a professional entertainer that people intuitively place zero value on work they can’t see. A performance half as long feels like it should be half the price, because the time spent driving there, setting up, waiting around to start, packing up and driving home doesn’t enter into their assessment of the value. While it’s clearly part of the “work” they are engaging you for, the intuition is that only the minutes spent on stage should actually be paid for.

There is another more modern medical example. Viagara became an instant success because the effects were immediately visible.

The episode is well worth a listen, or they have generously provided a full transcript that you can skim.

 

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