Editing Immunization (section)

===Positive externality===
Immunizations impose what is known as a positive consumer [[externality]] on society. In addition to providing the individual with protection against certain antigens it adds greater protection to all other individuals in society through [[herd immunity]]. Because this extra protection is not accounted for in the market transactions for immunizations we see an undervaluing of the marginal benefit of each immunization. This [[market failure]] is caused by individuals making decisions based on their private marginal benefit instead of the social marginal benefit. Society's undervaluing of immunizations means that through normal market transactions we end up at a quantity that is lower than what is socially optimal.<ref>{{Cite journal|last1=Hinman|first1=A. R.|last2=Orenstein|first2=W. A.|last3=Rodewald|first3=L.|date=2004-05-15|title=Financing Immunizations in the United States|journal=Clinical Infectious Diseases|language=en|volume=38|issue=10|pages=1440–1446|doi=10.1086/420748|pmid=15156483|issn=1058-4838|doi-access=free}}</ref>

For example, if individual A values their own immunity to an antigen at $100 but the immunization costs $150, individual A will decide against receiving immunization. However, if the added benefit of herd immunity means person B values person A's immunity at $70 then the total social marginal benefit of their immunization is $170. Individual A's private marginal benefit being lower than the social marginal benefit leads to an under-consumption of immunizations.