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Market for Human Organs

Michael Kratsios

Lecture 4
Coping with Unemployment
Mark Cohen is an unemployed
former magazine editor

He wants to sell one of his

kidneys (肾)

“A hundred thousand dollars

would do a lot more to stabilize
our finances than the other
items (a Pottery Barn cabinet, a
Thomas O'Brien leather club
chair, a cowhide rug) currently
under consideration for sale
around our house.”

Daily Finance, 11/14/09

History of Organ Donation
In 1951 the first successful kidney transplant in the United
States was performed.
Dialysis (透析) was developed in the United States in the 1960s,
but was expensive and scarce.
In 1972 the Social Security Act was amended to provide a full
Medicare-funded entitlement for dialysis therapy.
In 1984, National Organ Transplant Act passed, including a
prohibition against “knowingly acquir[ing], receiv[ing], or
otherwise transfer[ring] any human organ for valuable
consideration for use in human transplantation if the transfer
affects interstate commerce.”
Felony punishable by up to five years in prison
Now everyone must wait on the list.
Why is selling organs illegal
almost everywhere in the
Discussion Question 1
Classic Arguments
Commodification of body parts
What about women who sell their eggs, men who sell their
sperm, surrogate mothers?
Most vendors would be poor
Poor tend to be less healthy
Could place a quota on poor people’s organs
Coercive to the poor
Is offering a poor person a job coercion?
Encourage impulsive and reckless provision of organs
Could mandate a cooling off period (Iran - 6 months)
Recipients must be informed in writing fully of the risks during
surgery, the length of the recovery period, and other possible
Kidney Transplants in the US
Source: Becker and Elias
Deaths on Waiting List
Source: Becker and Elias
Supply & Demand Gap
Source: Becker and Elias
That is the average number of people who die
every day in America awaiting a kidney
What can be done to solve
this problem?
Discussion Question 2
Potential Solutions
If you consider a regulated cash market unacceptable:
Opt-out (Europe) vs. opt-in (US) to be organ donor
New England Program for Kidney Exchange
Specter (D-PA), Casey (D-PA), Tom Harkin (D-IA) Bill
Would allow the government to offer kidney donors a variety
of in-kind benefits, such as free health and life insurance
policies, a tax credit, or a generous contribution to a charity
of their choice. Other proposals have suggested allowing for
contributions to a donor's 401(k).
Repeal helmet laws, research by MSU economists
Organ donations due to motor vehicle fatalities increase by
10 percent when states repeal helmet laws (Dickert-Conlin,
Elder, & Moore 2009)
Potential Solutions
If you consider a regulated cash market acceptable:
Present system imposes an intolerable burden on many very ill
Eliminates black market, quality control problems
Reduces advantages of wealth in getting an organ
Only country in the world that has a regulated market for organ
In Iran, the waiting list for kidneys was eliminated in 1999, 11 years
after the legalization of organ vending, and since then Iran has had
no waiting list for kidneys
Vendors paid $1,200 by government and $2,300-$4,500 by
recipient (or charity)
Vast majority of donors are poor (<$5/day)
Economics of Organ Donation
Becker, Gary and Julio Jorge Elias. Introducing Incentives in the Market for Live and
Cadaveric Organ Donations

Cohen, Mark. White Collar Reset: Kidney for sale?


Dickert-Conlin, Stacy, Todd Elder and Brian Moore. Donorcycles: Do Motorcycle

Helmet Laws Reduce Organ Donations?

Dubner, Stephen and Steven Levitt. Flesh Trade


Hippen, Benjamin E. Organ Sales and Moral Travails: Lessons from the Living
Kidney Vendor Program in Iran