posted by chris on .
You are a utilitarian social planner and have a very limited number of vaccines to a new and potentially deadly virus.
How do you allocate them? Do you:
(A) give them to specific groups, such as high-risk populations, or
(B) sell them to the highest bidder and rebate the revenue lump-sum to everyone?
If you choose (A), do you allow those individuals allocated the vaccine to sell their dose to someone else?
Remember -your goal is to Maximize Total Utility.
The maximum utility is the action that helps the most people. That makes A the only choice. Presumably by distributing the vaccine to high risk populations, and not allowing them to sell this serum, you've maximized the total utility by preventing as many people as possible from contacting this disease.