The economics of LifeSharers

Professor Alex Tabarrok explains the economic theory behind LifeSharers in article in the Library of Economics and Liberty:

"The economics of common resources provides another perspective on the shortage of organs. Resources owned in common tend to be under-supplied and over-utilized. No one wants to pay to restock a lake, for example, when the benefits of restocking flow to everyone regardless of whether or not they helped to pay for the restocking. As a result, open fisheries are almost always driven to depletion. The solution is to close the fishery to those who do not help to restock the lake.

UNOS considers organs to be a "national resource," owned in common. The result, as in other areas, is a tragedy of the commons. Everyone wants to fish in the organ pool but no one has a direct incentive to "restock the lake" by signing their organ donor card. As with fishing lakes, a solution to this problem is to close the organ pool to non-donors.

Consider a no-give, no-take policy for organs. Under this system in order to receive an organ you must have previously signed your organ donor card. Under no-give, no-take, signing your organ donor card can be thought of as joining a club, the club of people who have agreed to share their organs. Or one can think of signing the organ donor card as the price that you pay for organ insurance.

An advantage of the no-give, no take policy is that it satisfies most people's moral intuitions. Many people find the idea of paying for organs distasteful but nevertheless are comfortable with the morality of reciprocity, those who are willing to give should be the first to receive.

A variant of no-give, no-take can be implemented quite easily within the current system by giving those who have previously signed their organ donor cards extra points that would advance them on the queue. In fact, a similar program is already in place. People who have previously been live organ-donors are given extra-points should their one remaining kidney fail them. No-give, no-take simply extends this idea from actual donors to potential donors.

Something like no-give, no-take is currently being implemented privately. LifeSharers.com is an "organ club." Anyone can join. Members agree that if their organs should become available they will go first to a fellow LifeSharers member. (If everyone joins LifeSharers, it becomes equivalent to no-give, no-take.)

Although reciprocity proposals like no-give, no-take have moral advantages it is important to remember that their primary purpose is to increase the incentive to donate and therefore to increase the total number of organs available."

Alexander Tabarrok is the Bartley J. Madden Chair in Economics at the Mercatus Center, George Mason University, and Director of Research, The Independent Institute. He writes regularly at www.MarginalRevolution.com.

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