Blood Money: Selling Plasma to Avoid High-Interest Loans
81 Pages Posted: 11 Oct 2021 Last revised: 22 Jan 2024
Date Written: October 11, 2021
Abstract
Little is known about the motivations and outcomes of sellers in remunerated markets for human materials. We exploit dramatic growth in the U.S. blood plasma industry to shed light on the sellers of plasma. Sellers tend to be young and liquidity-constrained with low-incomes and limited access to traditional credit. Plasma centers absorb demand for non-traditional credit. After a plasma center opens nearby, demand for payday loans falls by over 13% among young borrowers. Meanwhile, foot traffic increases by over 4% at nearby stores, suggesting that constrained households use plasma markets to smooth consumption without appealing to high-cost debt.
Keywords: plasma, donation, precautionary savings, payday loans, gig, discretionary income, consumption, health
JEL Classification: D12, D14, G23, J22, J28, J46, I14, I15
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