The 60-Second Mind podcast put out by Scientific American on January 31 brought us fascinating proof that price is an indicator of quality, proof that we believe this deep down in our bodies.
They described a study from the journal Neurology. [Alberto J. Espay et al, Placebo effect of medication cost in Parkinson disease: A randomized double-blind study]
The placebo effect is well known, where people who believe they are taking real medicine, even when it’s just a sugar pill, somehow heal themselves. In this study though, the researchers studied the effect of one placebo vs. another. The patients were told they were testing two treatments where one treatment costs $100 a dose while the other one costs $1,500 per dose. The patients were not told that both treatments were placebos.
Amazingly, the subjects who believed they were taking the $1,500 treatment showed 28% more improvement than those taking the other treatment. The more expensive the placebo, the more powerful the effect.
This is proof that even subconsciously we deeply believe that price is an indicator of quality.
One implication of these findings: the drug companies might be doing us a favor by keeping their prices so high. (Sarcasm)