Study confirms what I've known all along

Excellent Reuters story I read today on Yahoo (direct link).

Love that last quote.


Tue Mar 4, 4:02 PM ET

WASHINGTON (Reuters) - Want a sugar pill to work really well? Charge more for it.

A study published on Tuesday shows the well-known "placebo effect" works even better if the dummy pill costs more.

Dan Ariely, a behavioral economist at Duke University in North Carolina, and colleagues at the Massachusetts Institute of Technology tested 82 volunteers.

All got a light electric shock and were offered what they were told was a painkiller.

Half were given a brochure describing the pill as a newly approved painkiller that cost $2.50 per dose and half were given a brochure describing it as marked down to 10 cents.

Writing in a letter to the Journal of the American Medical Association, Ariely and colleagues said the effects were unexpectedly strong.

Eighty-five percent of volunteers who thought they were getting a $2.50 pill said they felt less pain after taking it, compared with 61 percent of those who thought they were getting a discounted drug.

The results fit with other studies that show charging more for something makes people value it more. But Ariely said the combination with the placebo effect was especially interesting.
"The placebo effect is one of the most fascinating, least harnessed forces in the universe," Ariely said in a statement.

The word placebo comes from the Latin word for "I shall please." Placebos, or sugar pills, are routinely used in trials of new drugs to see if they really work.

"How do we give people cheaper medication, or a generic, without them thinking it won't work?" Ariely asked.

(Reporting by Maggie Fox, editing by Will Dunham)