Alvin Roth uses game theory to analyze vaccine distribution. : The Indicator from Planet Money Right now, demand for a coronavirus vaccine far outweighs supply. Leaders are trying to figure out who should get the vaccine first. Dr. Alvin Roth, a Nobel Prize winning economist who specializes in game theory, has some ideas. | Support The Indicator here.

Who Gets A Vaccine? A Conversation With Alvin Roth

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STACEY VANEK SMITH, HOST:

This is THE INDICATOR FROM PLANET MONEY. I'm Stacey Vanek Smith. We have a vaccine for COVID-19. That is, of course, the most wonderful news. It means that there is a path out of the cycle of economic shutdowns and surges and illness and death and quarantine that we have all been living for the past 10 months, at least eventually. Right now, there are not all that many doses of the vaccine available, not nearly enough to meet demand.

Limited supply, great demand. That is, of course, an economics problem. States and countries have to decide now who gets the vaccine first and who gets it second and who gets it third. And there's one economist whose work is world famous for helping to make decisions like these.

ALVIN ROTH: Well, I'm Al Roth. And I'm a professor of economics at Stanford.

SMITH: You also won a Nobel Prize.

ROTH: I did.

SMITH: (Laughter).

Dr. Alvin Roth is a Nobel Prize-winning economist who is best-known for his work creating a kidney exchange - that is, finding ways to link up kidney donors with people who need kidneys. Alvin's work has saved thousands of lives. And now that the world is dealing with a shortage of lifesaving medicine, Alvin Roth's work is especially relevant. This is THE INDICATOR FROM PLANET MONEY. I'm Stacey Vanek Smith. Today on the show, who gets a vaccine, a conversation with Dr. Alvin Roth about how game theory can be used to help make medical decisions.

Dr. Alvin Roth, welcome to the show. You have famously used game theory to create an exchange for kidneys. But what exactly is game theory?

ROTH: So game theory is the part of economics - or mathematics, if you want - that thinks about the rules of the game. In other words, a lot of economics used to think about supply and demand only, right? You - someone needs a kidney. Someone else has kidney, you know? Multiple people need kidneys. That's the market. And, you know, market designers and game theorists start to say, well, so how would you go about doing that?

SMITH: So what were some of the complicating factors with kidneys? Because, I mean, one of them obviously is there's no money in this market.

ROTH: Right.

SMITH: But, also, there are all kinds of considerations, including the age and health and location.

ROTH: Yes, indeed.

SMITH: Yeah. So what were some of the factors that you had to consider when dealing with a kidney exchange?

ROTH: Well, all of those. And different kidney exchanges do those, differently. But it's better if it's a closer match to the patient. You can look at the distance that the kidney would have to travel. You can look at age. You can look at body size. Turns out bigger people have bigger kidneys. The game theory part is finding a way to organize those matches, right? Maybe it would be good for me and my donor and you and your donor to swap, but maybe we could do a bigger swap or find a chain, you know? I mean, we do all sorts of fancy things now. And so, sometimes, we can organize it to get a whole lot of transplants.

SMITH: And so, basically, you're coordinating a whole bunch of different things. And how did game theory help you do that?

ROTH: Well, game theory is about how people with somewhat different goals coordinate.

SMITH: Oh.

ROTH: I mean, when you're a market designer, you're talking about how to make the rules of the game so that when people play the game, they will coordinate gracefully.

SMITH: And get the best outcome.

ROTH: Well, so best is tricky 'cause you have all these different people. And what's best for me and what's best for you might not be exactly the same thing. In particular, there's a shortage of blood type O donors. So if you and I are both blood type O patients, then the system is constantly making a decision about - in this chain, we only have a limited number of blood type O donors, and we have an excess of blood type O patients in the pool. Which one should get it? So you and I might each agree that the best outcome is where we get the last blood type O kidney. But we can't both get it.

SMITH: Right.

ROTH: That's why when you talk about game theory, you can't really talk about what's best for everyone, what's - you know? We're trying to do what's good for the collective group.

SMITH: And the number of kidney transplants has been increased by a lot.

ROTH: So we get - you know, we get more than a thousand a year to a kidney exchange.

SMITH: That's a thousand lives.

ROTH: It is.

SMITH: What are - when you're looking at the - sort of the vaccine situation now, there are a limited number of COVID vaccines available, at least at this moment. What do you see when you look at that market right now? Not that it's a market per se but you know what I mean.

ROTH: Any time we're allocating scarce resources, you know, I think it's fair to talk about that as the marketplace. It's waiting for a scarce resource to become available. So what we do with organs is we form waiting lists and each organ has a different kind of waiting list. So that's a little bit like what we're going to see with a vaccine. Different states are going to have different rules of how to get vaccines. They also have different supply and demand. It might be that lots of people in New York will want to have a vaccine. And it's possible - and I'm purely speculating - that a smaller percentage of people in Tennessee will want it, right? We have a lot of vaccine hesitancy in the United States.

SMITH: Yeah.

ROTH: So one thing that reminds me of kidney exchange a little bit is exchange, supposing it turns out that we allocate to the states proportional to population, which I think we may be doing this morning. And suppose it turns out that in New York, you know, there's a giant shortage, you know, that there are lots of health care workers, and they're eager to get it. And then after that, there are lots of old people and vulnerable people of various sorts. And New York will develop a priority list.

At the same time, they might discover that in Tennessee, they've gotten more vaccines than they can get rid of on the first day because of vaccine hesitancy or maybe people aren't eager to try it out so early. So you could imagine an exchange, you know, that we'll send you 100,000 doses today and call them in two months when we think we'll need them.

SMITH: What would - like, what do you think is sort of an ideal way for states and I guess - and countries to start approaching this? Because it is complicated, and everybody wants this vaccine, right? A lot of people want this vaccine right now. The demand is greater than the supply. Like, what would you I guess like to see happen or like to see start happening for countries and states kind of making this decision?

ROTH: One thing that people have said is, you know, health care workers are important because they help us contain the disease. But they're also vulnerable to it because they're - especially if we talk about the health care workers who are treating people who are ill with COVID. So it might make sense to prioritize them so that the hospitals don't shut down, things like that.

But then you might also say, you know, people who are at risk in various ways should get a high wait because getting a vaccine might save their life. But then we might want to go in a different direction. We might want to say - who is likely to be a superspreader, you know? Who - and who is exposed by the nature of their work, you know? Maybe the essential workers who drive the trucks and deliver the goods and, you know, coming to your door and maybe getting your signature.

SMITH: Right, right 'cause this is a little different than a kidney because we're talking about a virus that can spread. So that's in there, too. Like, people who are more likely to - 'cause if we can vaccinate, let's say, like, people who do deliveries, then that could pay sort of exponential dividends.

SMITH: Right. And then we could also think about what's costly to us about the precautions we're taking. One of those things, of course, is child care. If you have school-age children and they're now at home and especially if they're quite young, so they can't even really do Zoom classes without your help, well, then someone in your household is not working very hard 'cause they're providing a service that teachers used to provide. So we might think about what set of vaccinations would be required to open up schools again 'cause that would be a big weight lifted off the economy.

SMITH: Oh, right. That would be - that would help in, like, other ways because then it could help people go back to work, yeah.

ROTH: You'd like there to be the biggest multiplier effect you can get for each vaccine that not only does good for the person getting the jab, you know, the needle in his upper arm but that jab should also do the most good for the most other people.

SMITH: Dr. Alvin Roth is a professor of economics at Stanford University and winner of the 2012 Nobel Prize in Economics.

This episode of THE INDICATOR was produced by Nick Fountain, fact-checked by Sean Saldana. THE INDICATOR is edited by Paddy Hirsch and is a production of NPR.

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