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Pricing Human Organs

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Iran, as you may know, has the dubious distinction of being the only country on earth that allows the selling of human organs by live donors, something that is outright illegal here in the U.S. Some economists have warned us about the persistent shortage of organs because of our system of free organ donation that results in the needless deaths of thousands of people, 6,500 per year according to some estimates. Patients on waiting lists are unable to find a matching donor and are faced with imminent death. Many more may die because they are not even placed on waiting lists to begin with because their doctors think the probability of finding a suitable donor is nil. These economists argue that many of these death incidences could have been prevented had we had an open market for human organs. In other words, if there are monetary rewards, people will respond positively. But, do they?  

Photo: flickr   by mallix

Needless to say, monetary incentives are not, and should not be, always the main motivation behind what people do or refuse to do. Organ donation is certainly not a business transaction and should not be viewed as one. It is done for moral gratification and the desire to save lives, not expectations of pecuniary compensation. Allowing human organs to be traded as common commodities undermines human altruism and the compassion that underlies the saving of human life. I scratched my head in disbelief when I learned that selling human organs is legal in Iran. It made me wonder why, in a country in which the so-called authentic Islamic values are the bedrock of its government, such transactions are allowed. And, if in fact the monetary incentive argument has such strong merit that it outweighs the guilt of selling body parts, can we even surmise that the government of Iran has done at least one thing right? You would expect that a theocratic government would be able to solve the organ transparent problem by appealing to the religious convictions of true believers and not through monetary remuneration.

Obviously, the humane solution to the problem of organ shortage is to appeal to people's altruism by invoking moral values. If a person willingly donates a kidney, purely for moral gratification, that is fantastic. But what happens if there are not enough voluntary donors? The U.S. experience seems to indicate that such an approach alone will not alleviate the pressure of shortage. Therefore, the alternative solution, as suggested by some observers, is to offer monetary incentives. This seems justifiably disgusting and indefensible, but it also raises an interesting question. If something is done for free, why is it good; but if it is done for money, why is it repugnant? Financial compensation would not necessarily be offered to living donors as is the case in Iran, but an innovative process might be designed to increase the supply of cadaveric organs. If this could be done successfully, then there would be no need to expose live donors to possible health risks, or perhaps demean them with the offer of monetary reward, or create a situation in which those who can afford to bid up prices take advantage of the desperation of poor people.

We also need to make a distinction between donation and allocation; these are two separate issues. Donation, especially under a zero-price system, is an admirable act of charity, and those who donate organs commendably save lives. However, the distribution scheme is subject to misuse and favoritism, and I believe this reality is the target of most of our criticism. It is most probable that a for-price system may lead to the exploitation of the poor by those patients who can afford to pay. Thus, only rich people become the main beneficiary of this system. Given the persistent organ shortage, it is not unusual for rich people in the United State to travel to another country to receive organs supplied exploitatively by poor donors in that country. If the shortage of human organs can be dealt with sensibly, such exploitation will stop. As it is now, under a free system, all the benefits are reaped by doctors, hospitals, and procurement agencies. Under a for-price system, however, at least some benefits are gained by the donors or their heirs.

According to some evidence, it seems the Iranian system has led to the elimination of kidney shortages, although in an appalling way. "If a decade's worth of reports in the transplant literature are to be believed, only one country in the world does not suffer from an organ shortage: Iran. Although Iran clearly does not serve as a model for solving most of the world's problems, its method for solving its organ shortage is well worth examining. Organ donation is ubiquitous throughout the world, but Iran is the only country that legally permits kidney vending, the sale of one individual's kidney to another suffering from kidney failure."

I have no way of proving or disproving what is claimed by this excerpt, however, I just post it for your comments. I am not so naive to claim that the laws of economics that apply to ordinary products will also apply to an unorthodox product such as a human organ. Paradoxiclly, however, if dog food was free, you would see lots of hungry dogs!

 

Reza Varjavand (Ph.D., University of Oklahoma) is associate professor of economics and finance at the Graham School of management, Saint Xavier University, of Chicago. He has been an avid participant in many professional organizations and active in (more...)
 

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and why I encourage you to be a donor: click here... by Daniel Geery on Wednesday, Feb 2, 2011 at 1:03:54 PM
A remarkable story, very well written, I am glad y... by Reza varjavand on Wednesday, Feb 2, 2011 at 2:01:59 PM
My son has had heart surgery twice for a congenita... by Judy Palmer on Thursday, Feb 3, 2011 at 8:07:29 AM
The surgeries and knowledge of the heart are getti... by Daniel Geery on Thursday, Feb 3, 2011 at 9:11:06 AM