By Gary Becker
THERE were about 50,000 persons on the waiting list for kidney transplants in the United States in the year 2000, but only about 15,000 kidney transplant operations were performed. This implies an average wait of almost four years before a person on the waiting list could receive a kidney transplant.
In addition, the cumulative gap between demand and supply for livers was over 10,000, which implies an average wait for a liver transplant of a couple of years.
In 2000, almost 3,000 Americans died while waiting for a kidney transplant, and half that number died while waiting for a liver transplant. Many also died in other countries while in the queue for an organ transplant. Some of these people would have died anyway from other causes, but there is little doubt that most died too early because they were unable to replace their defective organs quickly enough.
If altruism were sufficiently powerful, the supply of organs would be large enough to satisfy the demand, and there would be no need to change the present system. But this is not the case in any country that does a significant number of transplants. While the per capita number of organs donated has grown over time, demand has grown even faster. As a result, the length of the queue for organ transplants has grown significantly over time in most countries, despite exhortations and other attempts to encourage greater giving of organs.
In recent years, the US has taken several steps to improve the allocation of available organs among those needing them, such as giving greater priority to those who could benefit the most. These steps have helped, but they have not stopped the queues from growing, nor have they prevented large numbers of persons from dying while waiting for transplants.
Some countries use an 'opt out' system for organs, which means that cadaveric organs can be used for transplants unless persons who died had indicated that they did not want their organs to be so used. A study by Mr Sebastien Gay of the University of Chicago's Department of Economics shows that opt-out systems may yield somewhat more organs for transplants than the 'opt in' systems used by the US and many other nations, but they do not eliminate the long queues for transplants.
Balancing supply and demand
TO AN economist, the major reason for the imbalance between demand and supply of organs is that the US, and practically all other countries, forbid the purchase and sale of organs. This means that under present laws, people give their organs to be used after they die (or, with kidneys and livers, also while they are alive) only out of altruism and similar motives. In fact, practically all transplants of kidneys and livers with live donors are from one family member to another. With live liver transplants only a portion of the liver of a donor is used, and this grows over time in the recipient; the remaining portion regenerates over time in the donor.
If laws were changed so that organs could be purchased and sold, some people would give not out of altruism, but for the financial gain. The result would be an increased supply of organs. In a free market, the prices of organs for transplants would settle at the levels that would eliminate the excess demand for each type of organ.
In a paper on the potential of markets for live organ donations, Professor Julio Elias of the University at Buffalo and I estimate that the going price for live transplants would be about US$15,000 (S$20,300) for kidneys and about US$35,000 for livers. We recognise, however, that the data is too limited to be confident that these numbers would be close to equilibrium prices that equate supply and demand - they may be too high or too low. But even if our estimates were only half the actual equilibrium prices, the effect on the total cost of transplants would not be huge since current costs for live transplants in the US are in the range of US$100,000 for kidney transplants and US$175,000 for liver transplants.
An open market in organs would sharply curtail the present black market where some persons in need of transplants in effect buy organs by having transplants in poorer countries like Turkey, where enforcement against selling organs is slack.
Since the quality of the surgeons and hospitals in these countries is much lower than in developed countries, this often greatly reduces the quality of the organs used and how well they are matched to the organ types of recipients.
What the critics say
STILL, despite these strong arguments in favour of allowing commercial markets in organs, I do not expect such markets to be permitted any time in the near future because the opposition is fierce. Some critics simply dismiss markets as 'commodification' of body parts and deem it immoral. More thoughtful critics suggest that allowing organs to be bought and sold might actually reduce the total number of organs available for transplants because the number of organs donated from altruistic motives would decline by more than the organs provided because of the pay.
That scenario, however, is extremely unlikely since presently only a small fraction of potentially usable organs are available for transplants. Compensating persons either for allowing their organs to be used after their death, or for kidneys and livers to be used while they are alive, would enormously widen the scope of the potential organ market.
Another set of critics agree that the effect on the total supply of organs from allowing them to be purchased and sold would be large and positive, but they object to markets because of a belief that the commercially motivated part of the organ supply would mainly come from the poor. In effect, they believe the poor would be induced to sell their organs to the middle classes and the rich.
It is hard to see any reasons to complain if organs of poor persons were sold with their permission after they died, and the proceeds went as bequests to their parents or children. The complaints would be louder if, for example, mainly poor persons sold one of their kidneys for live kidney transplants. But why would poor donors be better off if this option were taken away from them? If so desired, a quota could be placed on the fraction of organs that could be supplied by persons with incomes below a certain level, but would that improve the welfare of poor persons?
Moreover, it is far from certain that a dominant fraction of the organs would come from the poor in a free market. Many of the organs used for live liver or kidney transplants are still likely to be supplied by relatives. In addition, many middle-class persons would be willing to have their organs sold after they died if the proceeds went to children, parents, and other relatives.
Although this is not an exact analogy, predictions that a voluntary army would be filled mainly with poor persons have turned out to be wrong. Many of the poor do not have the education and other qualifications to be acceptable to the armed forces. In the same way, many poor persons in the US would have organs that would not be acceptable in a market system because of organ damage due to drug use or various diseases.
Still another criticism of markets in organs is that people would be kidnapped for their organs, and that totalitarian governments would sell organs of prisoners. This would happen, but not likely on a significant scale since the source of organs offered for sale could be determined in most cases without great difficulty.
A criticism specific to a commercial market for live transplants is that some persons would act impulsively out of short-run financial needs, and that they would regret their decision to sell a kidney or allow their liver to be used for a transplant if they had taken more time.
I do not know how important such impulsive behaviour would be, but it could be sharply reduced by having a month or longer waiting period between the time someone agrees to supply an organ and the time it can be used. They would be allowed to change their mind during the interim.
Many of the arguments against the sale of organs indirectly stem from an influential book in the early 1970s by the British social scientist Richard Titmuss, The Gift Relationship: From Human Blood To Social Policy. He argues against allowing blood to be sold for transfusions, and compares the British system, which did not allow the purchase of blood, with the American system, which did allow it to be purchased.
Titmuss basically ignored the fact that the American system was getting more blood per capita than the British system. Instead, he concentrated on the quality of the blood. Since a significant fraction of the American blood came from individuals with hepatitis and other diseases that could not be screened out, the blood given under the British system tended to be healthier. In the absence of effective screening techniques, perhaps shutting down the commercial market was an effective way (at the time) to improve blood quality. But that is no longer the case as highly effective methods have since been developed to determine whether blood is contaminated with various types of hepatitis, HIV, and other transmittable diseases. Under present screening technology, a market in blood yields much more blood, and with enough diligence, its quality can be maintained at a high level.
My conclusion is that markets in organs are the best available way to enable persons with defective organs to get transplants much more quickly than under the present system. I do not find the arguments against allowing the sale of organs compelling, especially when weighed against the number of lives that would be saved by the increased supply stimulated by financial incentives.
The writer is University Professor of Economics and of Sociology at the University of Chicago and Senior Fellow at the Hoover Institution
This article first appeared in Capital Ideas, April 2006. It was referred to by Health Minister Khaw Boon Wan when he spoke about organ trading in Parliament on Monday.