Information conveyed on the price tag or label of a consumable packaged good is widely thought to change the consumer's sensory experience of consuming the good. Can the positive “placebo” effects of high prices and negative “nocebo” effects of low prices on consumer experience be isolated and observed in a controlled experiment without using deception? In a pilot wine experiment using a method I call “half-blind tasting,” I observe that the nocebo response to a $5 price tag is stronger than the placebo response to a $50 price tag. To interpret these preliminary results, I borrow some insights from prospect theory. (JEL Classifications: C91, D81, L66, M31, Q11)

Background: In randomized clinical trials, adverse events (AEs) are reported for the drug under evaluation and compared with the placebo group. Patients who receive placebo treatment report a high frequency of AEs, but little is understood about the nature of these. No study has yet analyzed the level of cognitive impairment as a crucial aspect for the AEs reported by patients.

Methods: The rates of AEs reported by patients with mild cognitive impairment (MCI) and Alzheimer's disease (AD) in the placebo arms of donepezil trials were compared using a systematic review approach. PubMed was searched with the terms “MCI and donepezil” as well as “AD and donepezil” from January 1989 to December 2010. Nineteen studies fulfilled the selection criteria (3 MCI, n = 783; 16 AD, n = 2,059).

Results: An overall comparison of 81 categories of AEs in the placebo arm of MCI versus AD trials showed that patients in AD trials experienced a significantly higher number of AEs than patients in MCI trials (p < 0.001).

Conclusions: This is the first study showing that AD patients may be at a greater risk of developing AEs than MCI patients. This may be related to a greater presence of somatic comorbidity predisposing them to express emotional distress as physical symptoms and/or to AD patients being frailer and therefore more susceptible to AEs. The phenomena we observed may be interpreted in terms of the “nocebo effect”.