Vaccines have a behavioural problem. If they are effective then they can eradicate a risk from our lives. The successful development of vaccines means that we are no longer exposed to a variety of illnesses that were debilitating and devastating. Yet because we don’t experience these traumas, it is easy to overlook the incredible benefits this scientific progress has brought society. Forgetting the risks that vaccines have removed means we are prone to understate their worth and give more weight to the other issues and concerns held about them.
But why does a problem concerning vaccines matter for investors? Because it is a vivid example of how the way we perceive and react to risks is about their prominence and how they make us feel. We worry about and respond to risks that are present and emotive, whilst disregarding those that are remote or removed.
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