Are Cheap Placebo's Worthless?
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Two years ago, the FTC was in Federal Court suing the manufacturer of the Q-Ray bracelet.
From the FTC press release regarding their legal case against the Q-Ray company
"The federal district court in Chicago has ruled for the Federal Trade Commission in its case against the marketers of the Q-Ray ionized bracelet following a bench trial earlier this summer.
In a decision issued September 8, the court found that advertising by Que Te (Andrew) Park and his companies was false and misleading in representing that the bracelet provides immediate, significant, and/or complete pain relief, and that scientific tests proved that it relieves pain.
The court also found that the defendants deceptively advertised their refund policy.
Although the court has not yet issued a final judgment order, it stated that it will require the defendants to turn over $22.5 million in net profits and pay up to $87 million in refunds to consumers.
The court also stated that it will impose a permanent injunction to prevent them from engaging in such deceptive conduct in the future."
I heavily criticized the Court of Appeal's reasoning at them time, being entirely devoid of a modern understanding of the paradox of placebos.
In particular, I argued the Chief Justice Easterbrook was wrong when he ruled that
"Selling brass as gold harms consumers independent of any effect on pain. Since the placebo effect can be obtained from sugar pills, charging $200 for a device that is represented as a miracle cure but works no better than a dummy pill is a form of fraud.
That's not all. A placebo is necessary when scientists are searching for the marginal effect of a new drug or device, but once the study is over a reputable professional will recommend whatever works best."
There is now more scientific evidence supporting my view.
Ariely recruited volunteers for a study and printed brochures describing an invented painkiller that was actually just a placebo.
Some were told the drug was expensive; others were told it was cheap. The subjects were given electric shocks before and after they took the pill. Those who got the pricey fake medicine reported a bigger reduction in pain than those with the cheaper fake.
Ariely's experiment, which appeared in the Journal of the American Medical Association, suggested that price and marketing of a drug may play a role in its effects.
Ariely won the coveted Ig award for his discovery that placebo's work better if costly.
"Real Nobelists help pick the winners, and hand out the prizes.
Over the 18 years, the Ig Nobel award has even become something to covet.
"I've won quite a lot of academic awards; I can't think of one that makes me happier than this one," said Dan Ariely , a Duke University economist and author of the book "Predictably Irrational: The Hidden Forces that Shape our Decisions," who said his deserving work has been passed over year after year and is elated to finally get an Ig Nobel."
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