Israel revamps its priority system for deceased donor organs

In an effort to increase the number of deceased organ donors, Israel has revamped its allocation system to give priority to those who have themselves signed up to donate, and to their relatives and the relatives of previous donors.

New Law For Organ Donation In Israel: Increased Priority For Those Who Are Prepared To Donate

"An article published Online First and in The Lancet reports that a unique new law comes into effect in Israel in January 2010. It states that people who are prepared to sign donor cards themselves receive priority when they are in need of an organ transplant. In addition, increased priority is given to first degree relatives of those who have signed donor cards, to first degree relatives of those who have died and given organs, and to live donors of a kidney, liver lobe or lung lobe who have donated for as yet undesignated recipients. The article is the work of Professor Jacob Lavee, Director of the Heart Transplantation Unit, Sheba Medical Centre, Ramat Gan, and the Israel Transplant Centre, and colleagues. "
...
"There are different levels of priority concerning the different situations. A transplant candidate with a first-degree relative who has signed a donor card would be given half the allocation priority that is given to a transplant candidate who has signed his or her own donor card. Then again, a transplant candidate with a first-degree relative who donated organs after death or who was an eligible live non-directed organ donor would be given allocation priority 1.5 times greater than that given to candidates who have signed their own donor cards. Among candidates with the same number of allocation points, organs will be allocated first to prioritisation-eligible candidates. Regardless of the new law, patients in urgent need of a heart, lung, or liver transplant due to their serious condition will continue to receive priority. However, in the event that two such people are eligible for the same organ, their priority status under the new law would decide who receives the organ. Candidates under 18 and those unable to express their wishes due to physical or mental disability will retain their priority status versus an adult who merits priority."

This priority system is more nuanced than the one enshrined in Singapore law (see the bottom of this post). And of course legislation on a national scale gives donors a priority for all deceased donor organs, not just those from like-minded donors, which is the path being taken by Lifesharers, an interesting organization about which I posted here.

HT: Steve Leider

Update: here's a YNet followup from March 2010 Radical way to boost organ donation.It discusses, among other things, political obstacles to implementing the new law...

Law and economics of repugnant markets

Kimberly Krawiec at The Faculty Lounge, some time ago followed up on one of my posts with an interesting one of her own: Selecting for Sex: US entrepreneurship in the baby market

She is a professor at Duke Law, and a scholar of repugnant markets, often analysing them with respect to rent seeking behavior. See e.g.

Altruism and Intermediation in the Market for Babies, 66 WASH. & LEE L. REV. 203 (2009).
Abstract: Central to every legal system is the principle that certain items are off-limits to commercial exchange. In theory, babies are one such sacred object. This supposed ban on baby selling has been lamented by those who view commercial markets as the most efficient means of allocating resources, and defended by those who contend that commercial markets in parental rights commodify human beings, compromise individual dignity, or jeopardize fundamental values. However, the supposed and much-discussed baby selling ban does not, and is not intended to, eliminate commercial transactions in children. Instead, it is an asymmetric legal restriction that limits the ability of baby market suppliers to share in the full profits generated by their reproductive labor, insisting instead that they derive a large portion of their compensation from the utility associated with altruistic donation. Meanwhile, a wide range of baby market intermediaries profit handsomely in the baby market, without similar restrictions on their market activities. Baby selling "bans" thus have more in common with the rent-seeking by powerful marketplace actors seen in other commercial markets than with normative statements about the sanctity of human life. The author concludes with a call for the removal of the last vestiges of the "ban" against baby selling and other laws that diminish the capacity of baby market suppliers to access the marketplace.

Price and Pretense in the Baby Market, in BABY MARKETS: MONEY, MORALS, AND THE NEOPOLITICS OF CHOICE (Cambridge University Press, forthcoming 2009).

Show Me the Money: Making Markets in Forbidden Exchange, 72 LAW & CONTEMP. PROBS. (2009).

Sunny Samaritans and Egomaniacs: Price-Fixing in the Gamete Market, 72 LAW & CONTEMP. PROBS._ (2009).
Abstract: This Article considers the market structure of the human egg (or “oocyte”) donation business, particularly the presence of anti-competitive behavior by the fertility industry, including horizontal price-fixing of the type long considered per se illegal in other industries. The Article explores why this attempted collusion has failed to generate the same public and regulatory concern prompted by similar behavior in other industries, arguing that the persistent dialogue of gift-giving and altruistic donation obscures both the highly commercial nature of egg “donation” and the benefits to the fertility industry of controlling the price of a necessary input into many fertility services – namely, eggs. A comparison to the egg market’s closest cousin – the sperm market – does not reveal similar collusive attempts to depress the price of sperm. A further analysis of the industry explores potential reasons for this difference.

The last two articles appear in an edited online journal volume by Professor Krawiec, called Show Me the Money: Making Markets in Forbidden Exchange, which has articles on the sale of blood, organs, eggs and sperm, labor, and surrogate wombs: here's her blog post summarizing them.

Your computer as a marketplace for internet browsers

Microsoft Makes New Concessions to Settle Browser Case
"Microsoft has agreed to reconfigure its Windows operating system in Europe to address two main complaints from rival Internet browser makers, a concession that could lead to the settlement of its latest antitrust case before the European Commission.
A person familiar with the commission’s plans said Microsoft had agreed to change the display of a ballot screen that European Union consumers would use to automatically download an Internet browser for their Windows-based computers.
Microsoft has agreed to randomly generate the logos of the major browser makers on the ballot screen, as well as to remove the Windows Internet Explorer logo from the screen frame, said the person, who was not authorized to speak publicly on the plan.
The changes were requested by Opera, a Norwegian browser maker, Mozilla and Google as preconditions to closing the case before European officials. Rival browser makers had been upset that Microsoft had planned to list the browser choices alphabetically, giving Apple’s Safari browser an advantage."

Indian marriage market for people in the same profession

Amol Agrawal blogs about an Indian Matrimony website for people in development sector.

It's here: devnetmatrimony.org. The site is in English, and at first it wasn't obvious to me it was directed entirely at Indian people (and the list for specifying your nationality seems to include the whole UN except for the U.S.), but the dropdown menu for specifying your mother tongue consists of these 22 choices: Assamese, Bengali, Bodo, Dogri, Guajarati, Hindi, Kannada, Kashmiri, Konkani, Maithili, Malayalam, Manipuri, Marathi, Nepali, Oriya, Punjabi, Sanskrit, Santali, Sindhi, Tamil, Telugu and Urdu.

Agrawal writes "We have many websites catering to the various communities but people also want to marry people in their own fields. Quite a few these days don’t mind marrying outside their communities but want to ensure the person is from the same field."...
"The issue is all the more for girls. They are worried that they may have to give up their profession after marriage if the in-laws family does not understand the work ethics with a profession.
Take the case of development sector. It involves a lot of travel to far remote areas for many a days. One could also be in areas where he cannot communicate about his location and well-being. Just imagine the situation for a married woman in this case."

Cousin marriage

The NY Times writes about marriage between first cousins, which is illegal in exactly half of the 50 States of the U.S.: Shaking Off the Shame.

"But even in the United States — one of the few countries in the world where such unions are illegal — marriage between first cousins may be slowly emerging from the shadows.

Although it is still a long way from being widely accepted, in recent years cousin marriage has been drawing increased attention, as researchers study the potential health risks to children of cousins. And the couples themselves have begun to connect online, largely through a Web site called Cousincouples.com, which bills itself as “the world’s primary resource for romantic relationships among cousins,” and is trying to build support for overturning laws prohibiting cousin marriage.
For the most part, scientists studying the phenomenon worldwide are finding evidence that the risk of birth defects and mortality is less significant than previously thought. A widely disseminated study published in The Journal of Genetic Counseling in 2002 said that the risk of serious genetic defects like spina bifida and cystic fibrosis in the children of first cousins indeed exists but that it is rather small, 1.7 to 2.8 percentage points higher than for children of unrelated parents, who face a 3 to 4 percent risk — or about the equivalent of that in children of women giving birth in their early 40s. The study also said the risk of mortality for children of first cousins was 4.4 percentage points higher."
...
"“It’s never as simple as people make it out to be,” said Dr. Bittles, noting that very early studies did not account for factors like access to prenatal health care, and did not distinguish between couples like Ms. Spring-Winters and her husband, the first cousins in a family to marry, and those who are part of groups in which the practice is common over generations and has led to high rates of genetic disorders. "
...
"Dr. Bittles, who is working on an update of the 2002 study, and other researchers argue that laws against marriage between cousins were rooted in myth and moral objections, and that they amounted to genetic discrimination akin to eugenics or forced sterilization. People with severe disorders like Huntington’s disease, who have a 50 percent chance of passing it on to their offspring, are not barred from marrying because of the risk of genetic defects, he said, so cousins should not be, either.
Historically, marriage between cousins has been seen as desirable in many parts of the world, and even today, slightly more than 10 percent of marriages worldwide are between people who are second cousins or closer, Dr. Bittles said. In the United States, the percentage is thought to be much smaller, although it is difficult to estimate, since such marriages have long been an underground phenomenon, because of laws forbidding them and because of the lingering incest-related stigma. "
...
"Martin Ottenheimer, who wrote “Forbidden Relatives: The American Myth of Cousin Marriage,” a 1996 book that was the first detailed examination of the issue in the United States, compared marriage between cousins to same-sex marriage. “People say, ‘If we permit this, what are we permitting? We’re down the slippery slope toward chaos. Then we’ll permit people to marry dogs,...’ ”
...
"Despite the efforts of some in Minnesota and New Hampshire to overturn state laws against cousin marriage after the 2002 study was published, it remains illegal there. And as of 2005, it is against the law in Texas as well.
The Texas ban was part of a law targeting polygamy, and the state representative who proposed it, Harvey Hilderbran, a Republican, said he would not have introduced a bill simply to prohibit marriage between cousins. Still, he said in an interview: “Cousins don’t get married just like siblings don’t get married. And when it happens you have a bad result. It’s just not the accepted normal thing.” "

Child marriage

Child brides' enduring plight: Problem illustrates hold of tribal doctrines

"Yemen has no minimum age for marriage, and girls as young as 8 are often forced to wed. Many become mothers soon after they reach puberty. The country has one of the highest rates of maternal mortality in the world. The death of a 12-year-old in childbirth this fall highlighted the health risks.
Child brides and young mothers are the most vivid manifestations of how tribal doctrines prevail over modern attitudes in the Middle East's poorest country. "

Saudi official moves to regulate child marriages
"Days after a Saudi judge upheld the marriage of an 8-year-old girl to a man 39 years her senior and blocked a divorce, the kingdom's justice minister said he plans to enact a law that will protect young girls from such marriages, according to local media reports. The law will place restrictions on the practice to preserve the rights of children and prevent abuses, Justice Minister Mohammed Al-Issa told Al-Watan, a daily newspaper in Saudi Arabia, where all newspapers require government permission to publish.Al-Issa said there would be a study of a system that will include regulations for the marriage of minors and everything related to such unions, the newspaper reported. No details on the restrictions or regulations were mentioned.The minister did not say whether child marriage would be abolished."

Child marriage still common in India
"The British raj tried to stamp it out. Mohandas Gandhi, himself a child groom, campaigned against it. The United Nations has condemned it. And in 2006, the Indian government explicitly banned it.
But child marriage remains pervasive in India, accounting for one-third of such unions worldwide and underscoring the contradictions and complexities of a society that produces cutting-edge engineers even as it clings to feudal traditions."


Here are two bills introduced in the House and Senate expressing the repugnance of the US Congress for child marriages in countries that receive U.S. foreign aid, neither of which seems to have made it out of committee. H.R. 2103: International Protecting Girls by Preventing Child Marriage Act of 2009; S. 987: International Protecting Girls by Preventing Child Marriage Act of 2009

Update: 12-year-old Saudi girl in divorce battle with 80-year-old husband

More non-simultaneous kidney chains

A non-simultaneous chain with some interesting features is reported in Washington DC, followed by 3 non-simultaneous chains, starting with 3 non-directed ("altruistic") donors, one involving 10 transplants, one resulting in 3, and one in 1, conducted over six days: 26 Operations, 13 Kidneys: Hope to Few With Little.

"The largest-ever single-city kidney exchange took place this summer in Washington. The seven-way exchange, which involved 14 patients, occurred at Georgetown University Hospital and Washington Hospital Center over four days in July. It was the brainchild of Dr. Keith Melancon, director of Georgetown’s Kidney and Pancreas Transplant Surgery, who used a procedure called plasmapheresis to address not only donor compatibility but racial disparity."

It's nice to see non-simultaneous chains having such good effect. (We'll know that extended chains have really come of age when someone other than Mike Rees conducts one that isn't reported as the largest of some kind ever. But publicity is good for letting patients who might benefit from kidney exchange know about it, and I imagine that's why the 3 chains were reported, with some fanfare, together as one set of 13 transplants.)

The story about the 7 transplant Washington exchange makes some further points in an interview with Dr. Melancon:

"Why does D.C. have the highest per capita rate of kidney failure in the U.S.?
It’s because of racial dynamics. In D.C. proper, over 70 percent of the population is African-American, and there’s also a good number of Hispanic–Americans. Both groups have higher incidents of end-stage renal disease. If you are African-American, you have four to five times the chance of having kidney disease versus a person who is Caucasian. There is a very high rate of hypertension and diabetes in this population, and those are the two main reasons why people have kidney disease in this country.
Why is it so hard to find a donor who is a good match?
The best type of transplant is a donation from a family member or friend while they are still alive. The problem with African-Americans in particular and those from lower socioeconomic groups is that their friends and family members tend to come from the same socioeconomic level, so it’s harder for them to take all the time off work for testing, surgery and recovery. Also, the same problems leading to the patient having the disease—high blood pressure, obesity, high cholesterol– will be higher in concentration in their communities. Then you have the problem of antibodies, which makes the prospect of getting a transplant more difficult because of higher incidence of rejection. With these patients in July, antibodies were so high that a traditional donor match was very difficult.
You’re focused not only on healthy kidneys but on the racial disparities that exist in this area of medicine. Will you elaborate?
Racial disparities contribute to much of the spectrum of disease that we see. Not only is kidney disease higher in certain ethnic groups, but there are differences in ability to access care. People who get transplants early in the course of their disease do much better than those who get transplanted later. You can chart how quickly a person can get to a transplant center, and it’s directly proportional to their socioeconomic status. Unfortunately, you can also see it’s in proportion to whether they are a minority or not....

"What are some of the technologies that enabled you to accomplish this?
One of the things that was most important to this process was a procedure called plasmapheresis. It allows us to remove the antibodies that would attack a new kidney. We put patients through this procedure so the body would accommodate the new organ. It’s very similar to dialyses in that their blood goes through a filter and then goes back to their body; the filter separates the liquid part of blood, which has antibodies in it. We throw that out and give them more liquid that doesn’t have antibodies. This is done over a period of three to four hours. They have to undergo this a few times before and after the transplant.
What was the cost?
A normal kidney transplant will cost $160,000. One done in this way (with plasmapheresis and extra medication)will increase the cost by about $100,000. However it’s still a savings versus the alternative. We already have universal health care for end-stage renal disease, and that’s been the case for the last 30 years. Dialyses costs $85,000 to $90,000 a year, so kidney transplant is always a benefit for the people and for the government."

Kidney transplantation in China

In China Daily: Kidneys illegally sold online

"Two major online forums www.02066.com.cn and www.as.2sun.cn, are operating for organ brokers in dozens of cities across the country, including Beijing, Tianjin, Zhengzhou and Shangqiu in Henan province, Hangzhou in Zhejiang province, Dongguan in Guangdong province, Changchun in Jilin province and Hefei in Anhui province.

...Ministry of Health officials said the trade in human kidneys is illegal, and pointed to the creation of a new database that has been designed to make organs available to the approximately 1 million Chinese waiting for transplants. The database began as a pilot project in some areas, including Shanghai, in September.

...Chen Shi, a professor in medicine at Huazhong University of Science and Technology, said the illegal trade must be banned to protect people's rights. "


Meanwhile, the American Journal of Transplantation has this to say:

"China's Vice Minister of Health, Huang Jiefu, MD, and the English-language newspaper China Daily announced in late August that China has established new national organ donation system to increase consented donors, halt rgan trafficking and quell the long-time dependence on use of organs from executed prisoners.1 A pilot project for the system, which will be operated mainly by the Red Cross Society of China with assistance from the Ministry of Health, will begin in 10 provinces and cities.
Within the China Daily article Dr. Huang says that prisoners, whom experts estimate account for more than 65% of total donors, "are not a proper source for organ transplants," nor should transplantation be a privilege for the rich.
Noting that "the candid observation by the Vice Minister is courageous and commendable," Francis L. Delmonico, MD, director of medical affairs for The Transplantation Society, advisor for human transplantation for the World Health Organization and a Harvard professor of surgery, says the concern of the international community regarding the recovery of organs from executed prisoners is that the need for organs has fueled the need, or demand, for executions. "The expectation that a foreign patient can undergo transplantation in China on a specified date—with blood type compatibility—brings that concern to a reality," he adds. He also says the international community, as represented by the Istanbul Declaration, supports the intention of China to establish a deceased donation system.
Statement From The Transplantation Society
While we can see some 'green shoots' of a new and ethical transplant program focused on meeting the needs of the Chinese community with end-stage organ failure, there is a long way still to go. There is no doubting that the Chinese Government in Beijing is determined to curtail the grisly trade in executed prisoners, so it seems mostly to have gone underground and a new trade in commercial living kidney and liver transplantation appears to be springing up. The Transplantation Society remains in contact with many people throughout China and is committed to helping to encourage these new signs of appropriate use of transplantation therapy, while remaining steadfast in opposition to the sale of organs to rich foreign patients.
—Jeremy Chapman, MD, president, The Transplantation Society"

The most selective colleges are getting more selective

That is the conclusion Caroline Hoxby reaches in "The Changing Selectivity of American Colleges"


Here's the abstract (the paper is gated): "This paper shows that although the top ten percent of colleges are substantially more selective now than they were 5 decades ago, most colleges are not more selective. Moreover, at least 50 percent of colleges are substantially less selective now than they were then. This paper demonstrates that competition for space--the number of students who wish to attend college growing faster than the number of spaces available--does not explain changing selectivity. The explanation is, instead, that the elasticity of a student's preference for a college with respect to its proximity to his home has fallen substantially over time and there has been a corresponding increase in the elasticity of his preference for a college with respect to its resources and peers. In other words, students used to attend a local college regardless of their abilities and its characteristics. Now, their choices are driven far less by distance and far more by a college's resources and student body. It is the consequent re-sorting of students among colleges that has, at once, caused selectivity to rise in a small number of colleges while simultaneously causing it to fall in other colleges. I show that the integration of the market for college education has had profound implications on the peers whom college students experience, the resources invested in their education, the tuition they pay, and the subsidies they enjoy. An important finding is that, even though tuition has been rising rapidly at the most selective schools, the deal students get there has arguably improved greatly. The result is that the "stakes" associated with admission to these colleges are much higher now than in the past. "

Matching and "undermatching" in college admissions

A recent commentary in the Chronicle of Higher Education summarizes a new book on how (in)frequently students finish college in the canonical four years:

Helping Students Finish the 4-Year Run By William G. Bowen, Matthew M. Chingos, and Michael S. McPherson


They make a number of points, two of which focus on matching. They find that many students, particularly from lower socio-economic backgrounds, "undermatch," by going to less selective colleges than they are qualified for. And they think that standardized tests play too large a role in sorting students to colleges.

"5. But money is by no means the entire story, perhaps not even the largest part. Student's choices of where to apply to college are enormously important. A surprisingly large number of students—especially those from poor families and those who are African-American or Hispanic—"undermatch." That is, they go to less demanding four-year institutions than they are qualified to attend, to two-year colleges, or to no college at all. For example, 59 percent of students in the bottom quartile of family income undermatch; 27 percent in the top quartile do so. In addition, 64 percent of students whose parents have no college education undermatch, compared with 41 percent of those whose parents have college degrees and 31 percent whose parents have graduate degrees (see Figure 3). Undermatching has serious consequences because there is a strong association between institutional selectivity and B.A.-completion rates: Students with essentially the same qualifications who attend more-selective universities have a considerably higher probability of graduating than do comparable students who attend less selective universities. Our data also confirm the results of other studies that show that students whose objective is to earn a B.A. are much less likely to do so if they start at a two-year college (again, other things equal).
6. "Sorting" of applicants by universities, especially overreliance on standardized tests, is consequential and problematic. We are not opposed to testing per se. Standardized tests can be helpful when used in the right ways and in the right settings. They are especially helpful when used with high-school grades to predict college grades at the most selective universities. It is clear, however, that high-school grades are far better predictors of graduation rates, especially at less selective universities. This finding holds even when we do not take account of differences in the quality of the high school that a student attended. Results of achievement tests, especially scores on Advanced Placement tests, are also good predictors. Both grades and achievement-test scores measure not only cognitive achievement but also coping and time-management skills—which, we surmise, affect completion rates."

Computer assisted markets: infrastructure

Some time ago the NY Times ran a story on "smart infrastructure:" Bringing Efficiency to the Infrastructure

The story was mostly how better metering and communication can lead to increased efficiencies. Some of these efficiencies come from making new markets possible; e.g. if your electric meter were smarter, it could allow more complicated contracts, in which you could have interruptible service when demand was high (e.g. you could have an electricity contract that would turn off your washing machine when demand was high, but allow you to turn it on again and be billed at a higher rate if you needed it even so.)

The story touches on this when it discusses congestion pricing in Stockholm:
"In 2006, Stockholm experimented with congestion pricing, charging cars up to $4 to enter the downtown area, depending on the time of day. The cars were monitored with RFID cards and webcams that photographed license plate numbers. Drivers had to pay within two weeks or faced penalties, but I.B.M. linked the driver data to 400 convenience stores in the city to make payment easier.
Within a few weeks, the impact in Stockholm was evident, and it has proved permanent. Car traffic in downtown Stockholm has been reduced by 20 percent, carbon dioxide emissions have dropped 12 percent, and the city’s public transport system has added 40,000 daily riders, I.B.M. said. The webcams accurately read license plates, even on snowy days, more than 95 percent of the time. So the RFID tags are no longer in use. After expenses, the smart traffic system generates $80 million a year for the city.
Stockholm is a city in a Scandinavian country with a long environmental tradition, in a socially democratic nation. Yet even in Stockholm, there were complaints initially. The city also took the risk of installing the entire system, calling it a trial, and then having residents vote on it seven months later, after the benefits were apparent. "

Shill bidding in domain name auctions

SnapNames Employee Caught Bidding on Auctions

That's from Elliot's Blog: Domain Name Investing News and Tips. (And you wondered why it was hard to find a domain name...)

HT: Ben Edelman, who notes "Shill bidders sometimes win, and therefore need a plan for how to dispose of the resulting asset. Working at the auction house is helpful."

School assignment in New York City

The December issue of the American Economic Review has our paper on the redesign of the NYC high school assignment system:
Abdulkadiroglu, Atila , Parag A. Pathak, and Alvin E. Roth, "Strategy-proofness versus Efficiency in Matching with Indifferences: Redesigning the NYC High School Match,'' American Economic Review, 99, 5, Dec. 2009, pp1954-1978. And here are the AER links at which you can access the Appendix and Download the Data Set

See my previous posts here and here.

Auction design by Paul Klemperer

Paul Klemperer alerts me to two new market design papers. He writes "here is the paper about the Product-Mix Auction, the new auction design for differentiated goods that I developed for the Bank of England from 2007,
forthcoming in the Journal of the European Economic Association. It is similar to Paul Milgrom's recent work on assignment auctions (we discovered this when we talked last year) -- No exciting theorems, but I paid a lot of attention to how to present simply, so bidders are comfortable participataing (and auctioneers are willing to use). I'm working on how to extend to some degree of complements, so maybe better theorems soon. The Product-Mix Auction: a New Auction Design for Differentiated Goods

"And here is a small enhancement of core-selecting package auctions (with Aytek who is taking up a lectureship (i.e. assistant professorship) at Cambridge University next year) -- we are working on the wider question of whether/when they are a good idea -- we currently take no position on that: A New Payment Rule for Core-Selecting Package Auctions by Aytek Erdil and Paul Klemperer

Course allocation at HBS

Some of the gems of the market design literature involve the careful analysis of existing institutions for allocating scarce goods, to understand the good and bad properties of those mechanisms, and the incentives they give to participants.

The latest example analyzes the way second year MBA courses at the Harvard Business School are assigned.

The Multi-unit Assignment Problem: Theory and Evidence from Course Allocation at Harvard by Eric Budish and Estelle Cantillon

Abstract: "This paper uses data consisting of agents. strategically reported preferences and their underlying true preferences to study strategic behavior in the course allocation mechanism used at Harvard Business School. We show that the mechanism is manipulable in theory, manipulated by students in practice, and that these manipulations cause meaningful welfare losses. However, we also find that ex-ante welfare is higher than under the Random Serial Dictatorship (RSD), which is the only known mechanism that is anonymous, strategyproof and ex-post efficient. We trace the poor ex-ante performance of RSD to a phenomenon, "callousness", specific to multi-unit assignment and unrelated to risk attitudes. We draw lessons for the design of multi-unit assignment mechanisms and for market design more broadly."

A related paper is Budish's proposal for an alternative mechanism: The Combinatorial Assignment Problem: Approximate Competitive Equilibrium from Equal Incomes.
(And here's my earlier post on an early version of that paper.)

Law and market design

Law obviously plays an enormous role in market design.
Haifa University's Forum for Law and Markets is hosting a conference today on Behavioral Analysis of Law: Markets, Institutions, and Contracts

Compensation for donors of human eggs for medical research

Fox News carries the following press release: Pro-Life Feminist Group Sues NYS over Compensation for Women's Eggs .

"Feminists Choosing Life of New York (FCLNY) filed suit Friday in New York State Supreme Court (Albany) to block the use of taxpayer funds to pay women recruited to donate their eggs for embryonic stem cell research."...

"New York State is the first governmental entity anywhere in the U.S. to approve taxpayer money to pay women to undergo an invasive procedure to harvest eggs for embryonic stem cell research.The legal complaint was filed on October 9, 2009 in Feminists Choosing Life of New York v. Empire State Stem Cell Board. In part, the complaint states, "The Payment for Eggs Program provides significant monetary inducements to women to engage in this painful and risky procedure, which in part disproportionately appeals to economically vulnerable women...(it)...fails to satisfactorily provide for informed consent and other safeguards to ensure adequate disclosure to women of the risks of egg harvesting."In 2007, the New York State Legislature enacted a new Title V-A to Article 2 of the Public Health Act, committing $600 million for stem cell research. On June 11, 2009, the Empire State Stem Cell Board (ESSCB), which was given the responsibility for administering the funds, passed a resolution authorizing significant taxpayer monies of up to $10,000 per donation to be used to compensate young women who donate their eggs for research. "...

"The National Institutes of Health guidelines for Embryonic Stem Cell Research recommends against payments to egg donors.The National Academies of Sciences agrees: “No cash or in kind payments should be provided for donating oocytes (eggs) for research purposes." "

HT: Egg Donation & Surrogacy Law Blog via Kim Krawiec at The Faculty Lounge, whose post includes a link to her paper on pricing in the gamete market.

The market for blood plasma

Is Money Tainting the Plasma Supply?

"Hundreds, probably thousands, of Mexicans like Ms. Delgado come to the United States to trade their plasma for dollars. Eagle Pass, a town of 27,000 that bills itself as the place “where yee-hah meets olé,” has two such plasma collection centers. There are about 15 others in border cities from Brownsville, Tex., to Yuma, Ariz.
The centers are run by pharmaceutical companies that transform the plasma into life-saving but expensive medicines for diseases like immune deficiencies and hemophilia.
Some border centers are new while others have been around for many years. They account for only a small percentage of the plasma collected by the industry, with the rest coming from collection centers throughout the United States.
But they have stirred debate in recent years because they illustrate the workings of the $12 billion plasma products business, a fast-growing industry that has depended on the blood of people hard up for cash. Based on typical industry yields and prevailing prices, it appears that a single plasma donation, for which a donor might be paid $30, results in pharmaceutical products worth at least $300.

Away from the border as well, many plasma collection centers have historically been located in areas of extreme poverty, some with high drug abuse. That troubles some people, who say it might contaminate the plasma supply or the health of people who sell their plasma.
“Why in the United States do we have to depend on people who are down and out to donate?” says Dr. Roger Kobayashi, an immunologist in Omaha who uses plasma products to treat many patients. “You are taking advantage of economically disadvantaged individuals, and I don’t think you are that worried about their health.” "
...
"But the plasma companies and federal regulators say the practice is legal, ethical and safe. There have been no known cases of an infectious disease being transmitted through plasma products for more than a decade. And since the body quickly renews its plasma, the process is considered safe for donors if properly monitored.
“It’s not like giving up a kidney,” says Dr. Jay Epstein, director of blood research at the Food and Drug Administration, which regulates the collection centers and the plasma products."
...
"The United States is one of the few countries that allows plasma donors to be paid. (And even here the plasma industry says it pays donors for their time, not for the plasma itself.)
But many of the countries that prohibit compensation do not collect enough plasma. So they rely on plasma or plasma products made from the blood of people who donate in the United States, which supplies more than half the world’s plasma.
“The U.S. is the OPEC of plasma,” says Jim MacPherson, chief executive of America’s Blood Centers, a network of blood banks.
FOR the plasma industry, times have been good. Growth has averaged 8 percent a year over the last two decades. "
...
"To satisfy demand for plasma-based medicines, the industry has increased the number of collection centers to 408, from 299 in 2005, according to the Plasma Protein Therapeutics Association, the industry trade group. Paid donations in the United States rose to 18.8 million in 2008 from 10.4 million in 2005. "

"There are even a few signs that in areas hardest hit by the economic downturn, people who once donated blood without compensation to organizations like the Red Cross are selling plasma instead. “I know of five or six people who are multi-gallon donors who have switched to plasma,” said Doug Klynstra, recruitment manager for Michigan Blood, a nonprofit blood bank. He said the bank’s donations are down 10 percent this year. "

"The blood banks generally collect whole blood, which is separated into red cells, platelets and plasma and often used for transfusions. They almost never pay for donations because that might induce donors to cover up health problems that could make the blood unsafe.
The plasma companies, which collect only plasma, say that is less of a concern for them because their manufacturing process can kill many viruses and because they have more time to screen donors. "

Compensating blood donors

Robert Slonim, Mario Macis, and Nicola Lacetera report on the effect of (non-cash) incentives on whole blood donation: Will There Be Blood? Incentives and Substitution Effects in Pro-social Behavior

Abstract: " We examine how economic incentives affect pro-social behavior through the analysis of a unique dataset with information on more than 14,000 American Red Cross blood drives. Our findings are consistent with blood donors responding to incentives in a “standard” way; offering donors economic incentives significantly increases turnout and blood units collected, and more so the greater the incentive’s monetary value. In addition, there is no disproportionate increase in donors who come to a drive but are ineligible to donate when incentives are offered. Further evidence from a small-scale field experiment corroborates these findings and confirms that donors are motivated by the economic value of the items offered. We also find that a substantial fraction of the increase in donations due to incentives may be explained by donors substituting away from neighboring drives toward drives where rewards are offered, and the likelihood of this substitution is higher the higher the monetary value of the incentive offered and if neighboring drives do not offer incentives. Thus, extrinsic incentives motivate pro-social behavior, but unless substitution effects are also considered, the effect of incentives may be overestimated."

DARPA Red balloons at MIT

The DARPA network challenge has been won by the MIT team: MIT wins $40,000 prize in nationwide balloon-hunt contest

"On MIT's Web site, a link was posted inviting people to sign up to help find the balloons and urging them to invite their friends. It said the MIT Red Balloon Challenge Team "is interested in studying information flow in social networks, so if we win, we're giving all the money away to the people who help us find the balloons!"
It detailed a chain for giving away the money, beginning with $2,000 given to each person who first sent in the coordinates of each balloon.
"We're giving $2,000 per balloon to the first person to send us the correct coordinates, but that's not all -- we're also giving $1,000 to the person who invited them. Then we're giving $500 whoever invited the inviter, and $250 to whoever invited them, and so on..." it said."

Here are some of the details from the MIT site linked to above...
The Challenge
This Saturday, December 5th, DARPA will be deploying 10 large, red weather balloons at 10 fixed locations in the United States. (more info) DARPA is giving $40,000 to the first team of people to find all 10 balloons. Join the MIT team, invite your friends and you can win money, help science, and help charity! (see how it works) .