33 Pages Posted: 19 Jun 2015
Date Written: June 17, 2015
Concerns with coercion and irrational decision-making underlie many of the arguments against compensated organ donation. Nonetheless, healthy adults are allowed, and even encouraged, to donate a kidney, without compensation, to patients in dire need of a functional organ. How does the introduction of a reasonably regulated system of donor compensation influence the decision-making of kidney donors and recipients? We address this question first under the assumption that the current conditions of kidney shortage are unchanged. We then extend the discussion by examining compensation in a regime in which the shortage of kidneys for transplants is greatly reduced or eliminated.
We argue that most of the issues that confront a compensated system of live kidney donation also are present in the current system, and they have prompted measures to safeguard the interests of patients. The addition of compensation does hold the potential to magnify some problems, especially for donors, such as present bias leading to imprudent decisions. Among the methods to deal with these problems are to rely primarily on in-kind compensation and to backload any monetary rewards.
The pressing shortage of kidneys presents donors and recipients with perplexing dilemmas. A system of compensation that relieves the shortage would lighten these dilemmas, to the benefit of patients, their families, and medical personnel.
Keywords: kidney, organ, transplant, behavioral economics, compensation
JEL Classification: I18, D64, J33
Suggested Citation: Suggested Citation