This book is the first attempt to analyze vaccination, which is a voluntary provision of public goods, from both empirical and theoretical perspectives, considering the possibility of a positive peer effect rather than a negative peer effect. From an economic perspective, vaccination has the benefits of reducing the probability of infection or disease onset not only for the individual but also for others in the surrounding area. The benefits are non-excludable and non-rivalrous, and have a public good character. The traditional theoretical framework for public goods predicts a free ride for the surrounding persons (i.e. negative peer effects) However, actual vaccination data do not necessarily support results in line with traditional theory. We empirically examine whether a positive peer effect exists with regard to influenza vaccination among the older adults in Japan, and find positive peer effects. Furthermore, based on the framework of the voluntary provision of public goods, we provide a theoretical model which is consistent with the positive peer effect. A positive peer effect can be derived as a Nash equilibrium of a two-person economy with simultaneous moves. Furthermore, under certain conditions, a positive peer effect also exists as a Nash equilibrium in a sequential move game. These theoretical findings have not been obtained in previous studies.
