Friday, March 2, 2018

The Economist discusses repugnant transactions

It's good to see repugnant transactions and forbidden markets making it into the (semi-)popular press.  Here's an article from The Economist, in part about my presidential address at the American Economic Association meetings in January.

Economists cannot avoid making value judgments
Lessons from the “repugnant” market for organs

It's nice to be quoted, not so nice to be misunderstood. Here's a sentence in which I object to the words "but mostly."

"Repugnance, he laments, tilts the political playing field against ideas that unlock the gains from trade. He recommends that economists spend more time thinking about such taboos, but mostly because they are a constraint on the use of markets in new contexts."

In fact I think that repugnant transactions are important for social scientists to study. (By "repugnant transactions" I mean transactions that some people would like to engage in while others think they should be forbidden, and for which there are no easily measurable negative effects on non-participants.)   For example, when you see laws all over the world against compensating kidney donors, it suggests that there are widespread perceptions that we economists would do well to understand, because understanding how and why markets enjoy social support is important.

Of course, repugnance sometimes constrains markets in ways that I regret. But not always: I'm not in favor of bringing back indentured servitude, for example.

Some of the misunderstanding of my talk seems to stem from how it was blogged about and live tweeted by Professor Beatrice Cherrier, of whom the Economist says

"But, as Beatrice Cherrier of the Institute for New Economic Thinking argued in an essay addressing Mr Roth’s lecture, these questions are fundamental to economics. The hard sciences deal much better with the ethical implications of their work, she says. And moral concerns affect human behaviour in economically important ways, as Mr Roth found to his frustration. To be useful, economists need to learn to understand and evaluate moral arguments rather than dismiss them."

She blogs as The Undercover Historian, and you can read her take on my lecture at the link below (worth reading, but she certainly never talked to me about what I think, and seems to me to have heard what she came to hear, rather than what I said...)

Not going away: on Al Roth’s 2018 AEA Presidential Address and the ethical shyness of market designers  Posted on January 7, 2018

You can hear (and see) my talk for yourself here:

AEA Presidential Address - Marketplaces, Markets and Market Design
Alvin E. Roth, introduced by Olivier Blanchard
View Webcast

I certainly don't dismiss repugnance: I wish I understood it better. You can see some of the things I'd like to understand by looking at my posts about repugnance on this blog. (As I write this, I see that I have 921 posts tagged with the label "repugnance")

I should add that I am often disappointed in the ethics literature that tries to address the appropriate scope of markets, and of economic transactions.  Much of it seems deaf to the idea that there may be tradeoffs that need to be considered when we contemplate public policies. You don't have to be a strict utilitarian to think that sometimes it may be reasonable to tolerate a small amount of harm in order to relieve a large amount of harm. (See my recent posts about harm reduction.)

In some organ transplantation circles, the version of the trolley problem that strikes a chord has to do with the universal agreement that if a hospital has eight patients facing imminent death due to lack of available organs, you still can't order a pizza and murder the delivery man for his organs, so that there will be one death instead of eight.

But some of the discussion in the ethics literature, which concludes that most attempts to increase transplants are ethically suspect, reminds me of a recent New Yorker cartoon. The picture shows what looks like a board of directors meeting, and the man at the head of the table asks
"Yes, it would save many lives. But to what end?"

Update: The Economist strikes back, see

Monday, May 7, 2018

I am slandered (or at least misunderstood) by The Economist for writing about repugnant transactions

You would think that writers for a magazine/newspaper called The Economist would read some economics before writing about it.


Beatrice Cherrier said...

I'm all ears, and willing to concede I have misinterpreted your address. So, what did I miss?

Al Roth said...

Bonjour! Happy to chat, maybe starting with email...