Dynamic Kidney Exchange
M. Utku Ünver
Boston College - Department of Economics
March 11, 2007
Review of Economic Studies, Forthcoming
We study how barter exchanges should be conducted through a centralized mechanism in a dynamically evolving agent pool with time- and compatibility-based preferences. We find the dynamically optimal two-way and multi-way exchange mechanisms that maximize total discounted exchange surplus. Recently several live-donor kidney exchange programs were established to swap incompatible donors of end-stage kidney disease patients. Since kidney exchange is a special instance of our more general model, dynamically optimal kidney exchange mechanisms are characterized as corollaries. We make policy recommendations using simulations.
Number of Pages in PDF File: 55
Keywords: Dynamic exchange, barter exchange, kidney exchange, matching, market design, dynamic optimization, Markov process
JEL Classification: C78, C70, D78, C61
Date posted: March 11, 2007 ; Last revised: December 17, 2009
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