Doctors, Car salesmen, and Asymmetrical Information

Most interactions can be boiled down to two people, either trying to cooperate or manipulate (aka defect). When each person has a nearly equal amount of information about the other, then it’s hard to defect. It might work once or twice, but eventually the other person will learn from their mistakes. Fool me once and all that.

In situations where one person knows considerably more than the other, it’s called asymmetrical information. That person can easily screw the other and get away with it. A common example is the Sleazy Salesmen. A salesman knows everything about the car, as well as most habits of customers and what phrases to use to increase the odds of a sale. They could sell you a car that wouldn’t be optimal for you, either because it’s lower quality than you realized when you bought it, or because it’s considerably higher quality than you really need.

With the advent of the internet, a deluge of information has been unleashed. We’re now able to research a car before we even show up to a car lot. We can learn sales tactics and brace ourselves against them. We can know almost as much as the car salesmen. Car salesmen will have to transition from thinking “How can I offload this junker on to an unsuspecting shlump?” to “How can I act as a liason to this person who has already decided what car they want.”

The same thing is going to happen to all industries. As somebody who doesn’t particularly care about cars, and cares a great deal about health, I’m especially looking forward to this happening to doctors. Traditionally doctors were paternalistic. They told you what to do… or else you’ll die. They withhold certain diagnoses because they don’t want to scare your pretty little face. Nefarious ones write prescriptions because they get a cut of the drug deal, while you get symptoms worse than the disease.

Pretty soon that won’t be possible. We’ll have WebMD times 10, so you can suss out your own symptoms and diagnose yourself. We’ll have garage laboratories where you can order test results from. I can see the day when it will be cheaper to sequence your own genome and take the necessary precautions against all of the diseases you’re predisposed to, than to see a guy in a white coat who pats you on the head and tells you not to worry about it (while secretly just worrying about a malpractice suit).

Yes many doctors will lose their jobs. But nobody complained when the sleazy car salesmen disappeared.

What do you think? Right? Wrong? Pure poppycock?