Price and Pretense in the Baby Market

Abstract:     
Throughout the world, baby selling is formally prohibited. And throughout the world babies are bought and sold each day. As demonstrated in this Essay, the legal baby trade is a global market in which prospective parents pay, scores of intermediaries profit, and the demand for children is clearly differentiated by age, race, special needs, and other consumer preferences, with prices ranging from zero to over one hundred thousand dollars. Yet legal regimes and policymakers around the world pretend that the baby market does not exist, most notably through prohibitions against baby selling - typically defined as a prohibition against the relinquishment of parental rights in exchange for compensation.

This Essay explores the costs of societal pretense that legal baby markets do not exist. Those costs include scarcity, foregone opportunities to address market failures, an inability to develop regulations designed to further particular public policies unlikely to be advanced solely through the goal of profit-maximization, and the promotion of rent-seeking. This Essay focuses specifically on the rent-seeking problem, arguing that, although frequently defended by those who contend that commercial markets in parental rights commodify human beings, compromise individual dignity, or jeopardize fundamental values, bans against baby selling (at least as currently written and enforced) serve little purpose other than enabling anti-competitive behavior by the most economically and politically powerful baby market participants.

Keywords: baby markets, adoption, surrogacy, fertility industry, egg, sperm, rent-seeking, symbolic law

JEL Classifications: K00, K32, K21

Accepted Paper Series