Blood Money: Selling Plasma to Avoid High-Interest Loans

81 Pages Posted: 11 Oct 2021 Last revised: 22 Jan 2024

See all articles by John Dooley

John Dooley

Washington University in St. Louis

Emily Gallagher

University of Colorado at Boulder - Department of Finance; Federal Reserve Banks - Federal Reserve Bank of St. Louis

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

Suggested Citation

Dooley, John and Gallagher, Emily, Blood Money: Selling Plasma to Avoid High-Interest Loans (October 11, 2021). Available at SSRN: https://ssrn.com/abstract=3940369 or http://dx.doi.org/10.2139/ssrn.3940369

John Dooley (Contact Author)

Washington University in St. Louis ( email )

Emily Gallagher

University of Colorado at Boulder - Department of Finance ( email )

Campus Box 419
Boulder, CO 80309
United States

Federal Reserve Banks - Federal Reserve Bank of St. Louis ( email )

411 Locust St
Saint Louis, MO 63011
United States

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