Word count: 10,391 Medical Innovation Revisited: Social Contagion versus Marketing Effort

This paper shows that Medical Innovation (Coleman, Katz and Menzel 1966) and several subsequent studies analyzing the diffusion of the drug tetracycline have confounded social contagion with marketing effects. First, we describe the medical community’s understanding of tetracycline and how the drug was marketed at the time the Medical Innovation data were collected. We find little reason to expect social contagion to have been important in physicians’ decision to adopt, but find that aggressive marketing efforts may have played an important role. Next, we re-analyze the Medical Innovation data set, supplemented with newly collected data on advertising volume (a measure of marketing efforts). Contagion effects disappear once we control for marketing efforts. Given the prominence of Medical Innovation and subsequent reanalyses, our results underscore the importance of controlling for potential confounds when studying the role of social contagion in innovation diffusion.