What happens if positive externalities related to vaccinations are not corrected?

When positive externalities related to vaccinations are not corrected, too few vaccines will be produced. This situation arises because vaccinations provide benefits not only to the individuals who receive them but also to society at large, such as herd immunity, reduced disease transmission, and lower healthcare costs.

In a market where these positive externalities occur, the private benefits earned by individuals who get vaccinated (such as immunity) do not capture the full social benefits (such as protecting others in the community from illness). As a result, private producers may under-produce vaccines since they do not receive adequate compensation for the additional social benefits their products provide. This leads to a market failure where the quantity of vaccines supplied is less than the socially optimal level, ultimately resulting in an insufficient supply of vaccines to meet the overall demand and societal needs.

Therefore, the outcome of not correcting for these positive externalities is that society ends up with too few vaccines produced, which can lead to higher incidence of diseases that could have been prevented through vaccination.