Cost of kidneys

Katie Silberman, who was kind enough to write to me about her husband Bryan's kidney transplant in an exchange last July, through NEPKE, writes again to give a snapshot of the costs.

"We just received the bill for Bryan's kidney transplant last summer.  As an economist, I thought you might be interested in these numbers.  I imagine you have asked your students how much a kidney is worth.  Well, according to Rhode Island Hospital, $44,895.90!  Of course they call it "organ acquisition," since we can't legally buy it.  Here is the breakdown of the bill:

Pharmacy                       15,356.03

Educ training                     160.65

Organ acquisition             44,895.90

M&S supplies                     2,382.96

Lab                                      3,696.65

radiology                                 282.45

operating room                 7,004.55

recovery room                   3,713.85

room charges                    12,966.00

addl room charges              1,504.00

total                                  $91,963.04

insurance adjust                $91,933.14

we owe:                            $29.90

"As a consumer, the $29.90 is ridiculous, but I'll take it.

"Most importantly, Bryan's health is fantastic, and we have our family back!

best,

Katie"

************

That is of course just the hospital bill, the docs are paid separately.

Katie further writes 

"Of course, we pay constant co-pays.  In fact, we are now in the process of applying for financial assistance from the pharma companies themselves for Bryan's drugs, which is an entirely different economic/ personal/ political calculus."

***********


NEPKE doesn't charge an organ acquisition fee at the moment, so I assume that line has to do with the evaluation of the donor, cost of the nephrectomy, and subsequent care. 
At the moment, the financing of kidney exchange is still in flux.

Matching and marriage: my spousonomics interview

The spousonomics team asks me about matching close to home: Economists in Love: Al Roth

Here's the first question and answer, out of four...

"1. People think game theory has no place in a marriage. But you told me once that marriage is a big game made up of little games, and the trick is to focus on the big one, not get tripped up by the little ones. Explain.

I don’t recall that conversation, but my answer makes me think that you must have asked me whether game theory helped me get out of doing the dishes. That doesn’t strike me as the right focus, when you’re thinking about someone with whom you’re going to be lovers and friends and parents together, and each other’s closest confidant, most unconditional ally, and most devoted historian.  Let’s just say that marriage is a dynamic game that you play over a lifetime."

The market for typewriter ribbons

...has just taken another hit. I guess I had better retire my manual Corona. Fortunately the ability to type remains a useful skill...

The Telegraph reports:
End of an era as last mechanical typewriters are sold
An era of clattering keys and inky ribbons is coming to an end, as the world's last mechanical typewriter manufacturer has revealed it has only 500 left in stock.

"Godrej and Boyce, of India, ceased production in 2009 and has now almost cleared its remaining inventory, according to theBusiness Standard.

The firm's typewriter business peaked at 50,000 per year as the Indian economy took off in the 1990s, but tailed off as computers quickly took over.

"From the early 2000 onwards, computers started dominating. All the manufacturers of office typewriters stopped production, except us," said general manager Milind Dukle.

"Till 2009, we used to produce 10,000 to 12,000 machines a year," he added.

"Godrej and Boyce still sells a few of its remaining mechanical typewriters to defence agencies, courts and government offices in India"

Society for Economic Design Conference in Montreal in June

The meeting is June 15-17, and the preliminary program is online.

There are many sessions on matching (I remember when matching was a very specialized interest...:)

Marriage among the Tinkers of Thrace

"The NY Times reports on the evolution of the market for brides among Bulgarian Roma: Subtle Shift at the Gypsy Bride Market

"STARA ZAGORA, BULGARIA — In a field outside town, teenage girls in skimpy outfits worked the crowd at what is known locally as the “Gypsy bride market.” Clad by contrast in long velvet skirts and brightly colored headscarves, their proud mothers watched. Gold flashed on necks, fingers, ears and teeth.


"Meet the tinkers of Thrace, semi-nomadic Roma who in the early 21st century are among the few in Europe hewing to ancient ways.
...
"Technically, the young women at this traditional St. Todor’s Day “market” were not for sale. But it is at this fair, held each year on the first Saturday of Orthodox Christian Lent, that the Kalaidzhi (as the estimated 18,000 Thracian tinkers are known) conduct the complex negotiations on a bride price that traditionally lead to marriage.


"The identity of this semi-nomadic Roma group is based on the ancient craft of its menfolk: producing and repairing pots, pans and caldrons. For centuries, these smiths have scattered in ones or twos in Bulgarian villages to practice this craft, and they get together rarely for events like the St. Todor’s fair.


"This is therefore one of the few opportunities for teenagers to meet other Kalaidzhi — and potential spouses. Dating is not really an option when teenage boys and girls are forbidden to meet without an adult. Marriage outside the group is equally taboo.


"Leaning against his car, surveying the scene, Hristos Georgiev, 18, was pleased to be wrapping up negotiations with the father of Donka Dimitrova, an 18-year-old he expected to marry weeks later. Bargaining had narrowed to between 10,000 and 15,000 levs, or $7,500 to $11,300, well more than a year’s worth of the average Bulgarian’s wages of 8,400 levs. He said he saved the money working construction in Cyprus.


"According to Velcho Krustev, an ethnographer with the Bulgarian Academy of Sciences, “the man is not buying a wife, but her virginity.” The payment ensures the bride will be treated well by her new family, he said.
...
"Kalaidzhi are among the most tradition-bound of Roma. But even they are changing — to the distaste of elders like Ivan Kolev, 73.


"While he insisted the bride price would stay — “our people always insist that a girl be a virgin” — he noted that Kalaidzhi women “were much shyer” when he married some 50 years ago. “Now they just elope. Now they go around like Bulgarians.”

Pro-social behavior of all kinds: Judd Kessler

Judd Kessler defended his dissertation yesterday (successfully, I should add:).

His work includes lab and field investigations of charitable giving, of provision of public goods, of cooperation in the presence or absence of contracts, of team production when pay is equal or unequal, and of the decision to be an organ donor.

His job market paper, “Signals of Support and Public Good Provision,” is unusual in the way it combines experiments both in the field and in the lab. The field experiment involves a big national charity’s regional campaign in about 200 firms, covering around 25,000 employees. One of the treatment conditions involved giving out buttons to all employees, which they could wear if they wished to express support for the charity. This turned out to have a surprisingly large effect on giving: it increased the number of donations and the amount donated by about a third. Another treatment involved giving out raffle tickets to those who contributed, and this did not have a positive effect on giving. The hypothesis is that the buttons (unlike the raffle tickets) provide information to coworkers about the level of support the charity enjoys, and that when they receive positive information about this they are more likely to contribute themselves.

But a field experiment is by nature imperfectly controlled, so Judd also conducted a lab experiment modeled on the field experiment (in which subjects also had an opportunity to contribute to a charity), but with careful controls in place to test for alternative hypotheses. The treatments in the field experiments already suggested that we aren’t seeing increased contributions because of gift exchange (i.e. the button isn’t regarded as a gift, as the raffle tickets might be), and what Judd finds in the lab is that the major effect of seeing another subject who has chosen to wear the button is that it increases a subject’s estimate of what the other subject will give, and this appears to be the mechanism through which contributions are increased. (Subjects also contribute more when wearing a pin, so this is a rational expectation.)

Judd’s field experiment and lab experiment complement each other; the lab experiment couldn’t have given a reliable prediction of the magnitude of the effect Judd observes in the field, while the field experiment leaves open many more hypotheses about the cause of this effect than does the lab experiment.

Welcome to the club, Judd.

Boston School Choice: it's not all location

The latest article in the Globe's series on school choice in Boston, by Jenna Russell, makes very graphically a point I like to make by saying that school choice always brings out two political viewpoints. Those who live close to good schools are members of the "walk to school party", while those who don't are members of the "school choice party".  In Boston, those interests are accommodated by having half the seats in some schools give a priority for children who live in the "walk zone," while the other half do not. The decision is then made based on the preference lists the families submit (via a deferred acceptance algorithm that makes it safe for families to reveal their preferences), with ties broken by lottery.

The article focuses on two children, one of whom lives right across the street from a good school and one who doesn't. The kindergarten only has 32 places, only 16 of which are reserved for local children, with the other 16 giving everyone equal access. Since there are lots of ties, the lottery is important.

An early education in the meaning of ‘no’

"The system seems deeply regrettable to her parents, Jen and Doug Bowen-Flynn. But to Marie and Markel Wade of Dor chester, it is a blessing. They, too, live steps away from an elementary school. If school assignments were based on proximity, they would have no choice but to send their children to Winthrop Elementary, which has lower test scores and a less polished reputation.

Instead, because of a lottery that gives all students a chance to seek a seat at better-regarded schools, it is they who send their children to the school on Sawyer’s doorstep."

(Our papers on the design of the Boston school choice mechanism here.)

The international market for stolen cars

The Washington Post reports: International theft rings steal hundreds of vehicles in D.C. area every year

"Officials estimate that each year in the Washington area alone, hundreds of cars are stolen and shipped overseas. New York authorities announced last June that they had charged 17 people with stealing and shipping hundreds of luxury cars. Other D.C. area police officials and a spokesman for the FBI’s Baltimore Field Office said their detectives have worked similar cases.
...
"The ring’s bosses are usually based in African countries or other developing nations, where it is more difficult to find reasonably priced, mid- to high-end vehicles, authorities said. They order specific cars from middlemen in the United States, and then low-level thieves set out to get their cut.

"In the Prince George’s ring, the thieves are paid according to the vehicles they carjack or steal — $1,500 for a Toyota Camry, $2,500 for a RAV4, $5,000 for a Porsche Cayenne, Aponte said. The middlemen handle the rest. They stash the stolen cars in parking lots or neighborhoods, waiting to see whether police are on their trail. Then they load the vehicles onto shipping containers bound for Africa, police said. The rings are especially prevalent in the D.C. area, police said, because of its proximity to ports."

Lending library for newspapers (help wanted ads, mostly)

Sonia Jaffe points me to this article: Renting a read from 'newspaper landlords'

"Garum Tesfaye is one of Addis Ababa's "newspaper landlords," a group of entrepreneurs in the Ethiopian capital who rent out papers to people too poor to buy them.
...
"For 20 to 30 minutes, these readers can get their hands on a newspaper for a fraction of the price of having to buy it. If they keep the paper longer than their allotted rental time, they have to pay extra.
"A newspaper in Addis Ababa costs about six birr (35 U.S. cents) to buy. In contrast, it costs only 50 Ethiopian cents (less than one U.S. cent) to rent one.
"If 20 readers read this single paper at the rate of 50 cents, I will make 10 birr (about 60 U.S. cents)," says Tesfaye, whose business serves a regular customer base that visits his makeshift roadside shop each day.
"Most of the readers focus on vacancies rather than regular news," Tesfaye says."

High school choice in New York City: some advice for next year

An article in the NY Times discusses the plight of 8th graders who do not match to a school in the main round of the high school match: Lost in the School Choice Maze

Many of the unmatched children interviewed in the story, who now have to participate in an additional round of matching to get their school assignments, only ranked a few school programs (instead of the 12 they are allowed to rank), and also  seem to have received bad advice in other ways, like the child mentioned at the end of this quoted section.

"This year, of the 78,747 students who applied, the computer matched 83 percent to one of their top five choices. An additional 7 percent were matched to schools lower on their lists. The rest, like Radcliffe, were unmatched. Over the past three years, officials said, there has been a slight but steady increase in the number of unmatched students, up from 8 percent last year and 7 percent in 2009.
One new variable this year was the department’s publishing of graduation rates in school descriptions, which caused a surge in applications to the best schools, said Robert Sanft, the chief executive of the Office of Student Enrollment. The competition at many of those top schools meant long-to-impossible odds. Baruch College Campus High School, with a 100 percent graduation rate, received the most applications from across the city: 7,606 for 120 seats, giving it an acceptance rate of about 1.6 percent (Harvard, by contrast, accepted 6.2 percent of its applicants.)
But geography was a significant factor for Baruch, especially for those who, like Radcliffe, applied from outside Manhattan. According to Baruch’s principal, Alicia Perez-Katz, the school, created for Manhattan’s District 2, has not accepted out-of-district students in many years, a fact not mentioned in the Education Department’s school profile."


At the beginning of April, I responded to an email describing the plight of an unmatched student (who had only applied to six programs, none of which, I am informed, had ever accepted a student with his solid but not spectacular math grades), as follows.

Dear Jimmy: I'm sorry to hear that you weren't matched in the main round of the high school admissions process. I know that is very stressful.

I helped design the choice algorithm in 2003-04, but I have no role in its continued operation, and I don't know which schools may be available now. So you need to get advice from people with current, hands-on experience. Your guidance counselor might be a good person to start with, on Monday if you can.

As you indicate in your email, the next step of the process is to get matched to some school in the supplemental round. After that there is an appeals process. My advice is to take the supplemental round seriously. For a start, you might take a quick look at the advice here:  http://insideschools.org/blog/2011/04/01/no-high-school-match-heres-what-to-do/

You may also be able to get some information now from the Office of Student Enrollment Planning and Operations (OSEPO). At the very least they can give you the information you will need to participate in the appeals process.

If you don't get into a school you are happy with, there are transfer options that you can pursue to change schools for 10th grade.

I hope you won't give up on your ambition to go to Harvard after you graduate from high school. I'll be very glad to meet you if you come here. But when it comes time to apply to colleges, bear in mind that admission to Harvard and other top universities is very competitive, so be sure to apply to other schools, including some safe schools.

Best of luck,

Al Roth"


So, for next year, I have two bits of advice, for students and for the schools.

For students: use all 12 choices. The system is designed so listing 12 choices won't hurt your chance of getting one of your top ones. But if you don't get one of your top choices, having some other schools on your list that you wouldn't mind going to will save you some heartache.

For schools and guidance counselors: give these kids more useful advice! They should be told if the lists they are submitting include only schools for which they have little or no chance of being accepted.

In Chicago

http://mfi.uchicago.edu/events/20110506_matching/index.shtml

Milgrom on market design

Paul Milgrom has an article in the latest  (April 2011) issue of Economic Inquiry:
CRITICAL ISSUES IN THE PRACTICE OF MARKET DESIGN

Abstract: The years since 1994 have witnessed the emergence of market design as a new discipline within economics, in which research and practice exert powerful mutual influences in matching and auction markets. The problem of designing well-functioning auction markets has led economic designers to revisit such fundamental issues as the definitions of commodities, the ways participants communicate with markets, the trade-offs between the incentives provided for truthful reporting and other attributes of mechanism performance, and the determinants of the scope of markets, especially whether and how trade in different goods is linked.

Nonsimultaneous kidney exchange chains produce more transplants than simultaneous chains (published)

When I published the earlier post with the same name, the paper hadn't yet been published, and medical journal rules meant that I could only link to an abstract.

Now the paper has appeared, and you can read it here:

Ashlagi, Itai, Duncan S. Gilchrist, Alvin E. Roth, and Michael A. Rees, ; ''Nonsimultaneous Chains and Dominos in Kidney Paired Donation -- Revisited,'' American Journal of Transplantation, 11, 5, May 2011, 984-994. 

Misc. kidney exchange

A larger than usual exchange in SF: SF hospital performs 10-person kidney exchange
"Five people have received healthy kidneys from five donors in what may be among the largest kidney exchanges at a single hospital in California.

"The swap at California Pacific Medical Center took place on Friday during a series of operations, the San Francisco Chronicle reports.

"This has been bread-and-butter for us for a few years; we've just never done one of this size," said Dr. Steve Katznelson, medical director of California Pacific's kidney transplant program. "There are all sorts of logistics involved, and it's hard to do."
******

Kidney exchange in India is still rare (but not rare like a unicorn): Two women in kidney swap to save life of other’s spouse
"Dr H Sudarshan Ballal, medical director and chairman, medical advisory board of Manipal Health Enterprises, said swap transplants are common in the US but not so in India. "One of my earlier patient was a middle-aged woman whose husband was a potential donor but incompatible with her. They migrated to the US and later told me they had done a swap with a Jewish couple there. We've been trying for a long time to make swap transplants happen but managed it this time," he said. "

****
Here's an account of a non-simultaneous nondirected donor chain at St. Barnabas hospital in New Jersey, conducted around Valentine's day, with reporting of an April 2011 meeting of patients and donors: Donors, recipients in chain of eight kidney transplants gather for reunion.
The non-directed donor chose to remain anonymous "I’ve got some new scars, but that’s it," the donor said. "I’d rather it not be a big deal."

Bait and switch in law school admissions?

A much blogged about article in the NY Times discusses how law schools offer many admitted students merit scholarships whose continuation depends on their maintaining a certain grade point average. The article notes that, coupled with forced-curve grading policies, this sometimes means that many of those with first year scholarships will inevitably fail to maintain their eligibility for continued scholarship assistance. It argues that the algorithm used by US News and World Report to rank law schools plays a role, by focusing on statistics for the entering class.

Law Students Lose the Grant Game as Schools Win

"Why would a school offer more scholarships than it planned to renew?


"The short answer is this: to build the best class that money can buy, and with it, prestige. But these grant programs often succeed at the expense of students, who in many cases figure out the perils of the merit scholarship game far too late.

"On the Golden Gate campus recently, a group of first-year students at risk of losing their scholarships were trying to make sense of the system. Most declined to be identified for this article because criticizing the school seemed, at minimum, undiplomatic. But the phrase “bait and switch” came up a lot. Several assumed that they were given what is essentially a discount to get them in the door.
...
"If it sounds absurd that America’s legal education system could be whipsawed by, of all things, U.S. News, you have yet to grasp the law school fixation with rankings. Unlike undergraduate colleges, law schools share far more similarities than differences, particularly in the first-year curriculum.


"So a lot of schools regard the rankings as their best chance to establish a place in the educational hierarchy, which has implications for the quality of students that apply, the caliber of law firms that come to recruit, and more. Striving for a high U.S. News ranking consumes the bulk of the marketing budget of a vast number of schools.

"Which is where scholarships come in.

"The algorithm used by U.S. News puts a heavy emphasis on college grade-point averages and Law School Admission Test scores. Together, those two numbers determine about 22 percent of a school’s ranking. The bar passage rate, which correlates strongly with undergraduate G.P.A.’s and LSAT scores, is worth an additional two points in the algorithm. In short, students’ academic credentials determine close to a quarter of a school’s rank — the largest factor that schools can directly control. "

Love and Warcraft

Any venue in which lots of single people invest time and energy in something that interests them can provide the thickness needed for an effective mating market.  You can get a date by being an active Yelp reviewer*, and, it turns out,  World of Warcraft isn't bad either, as Stephanie Rosenbloom reports in the NY Times: It’s Love at First Kill

" With more than 12 million subscribers, World of Warcraft is one of the most popular games of its kind in the world (others include EverQuest, Aion, Guild Wars). That’s a sizable dating pool. Match.com, by way of comparison, has fewer than 2 million subscribers."


***
*My new HBS colleague Mike Luca has studied Yelp, including (in passing) the way that they create a social network for their most active reviewers.

“Matching markets: Theory and practice”

That's the title of this paper by Atila Abdulkadiroglu and Tayfun Sonmez, presented at the 2010 Econometric Society World Congress, in Shanghai.

Yeon-Koo Che has just posted his discussion of that paper. Among other things, he suggests that one reason we don’t see more centralized clearinghouses is that they don’t necessarily create Pareto improvements, and a hybrid approach is worth thinking about. (For example, he speculates, maybe a centralized clearinghouse for college admissions could be started if it explicitly allowed colleges to continue to engage in early admissions, and only tried to organize the "regular admissions" part of the market.)

Designing "hidden markets"--Sven Seuken

Yesterday Sven Seuken defended his dissertation, which is on the interface of CS and Economics. In particular, he is interested in designing both computerized marketplaces and the user interfaces through which participants will interact.

The essay that was his job market paper concerns a practical business idea for a centrally administered marketplace for peer-to-peer computer backup services that have to be consumed in bundles (e.g. bandwidth and memory are complements), but may be offered in different proportions by different users, at market prices that are posted through a user interface that makes it easy for a consumer to see what backup he requires, and what combinations of resources he can offer to the system to pay for his own services. A customer for the backup service must offer backup services to other customers, and the  centralized server keeps track of what resources are being used, and sets relative prices for different resources that are “hidden” in that they are revealed not as numerical prices, but as tradeoffs between backup capacity a consumer demands and various ways that he can supply the system with resources from his own computer (upload and download bandwidth and memory, and hours a day connected to the web).

That is, this is a market with complements, in which both bids and asks must be for packages of services, but in which customers can participate using a simple interface.

Market design itself is becoming a market with complementarities between economists and computer scientists. Sven may join his main advisor, David Parkes, in internalizing many of these complementarities himself. (The other members of his committee were Eric Horvitz, Yiling Chen, and me.) Since he is going to Zurich, he may also have the opportunity to join forces with Jacob Goeree and solidify a real center of market design there.


Welcome to the club, Sven.

First kidney exchange in Spain

La Vanguardia reported yesterday on a nondirected donor chain, the first in Spain (and I think the first kidney exchange in Spain):

Éxito en la primera cadena de trasplante renal de vivo con 'buen samaritano'
El primer 'buen samaritano' de España es un religioso de Barcelona que de forma altruista y anónima ha entregado uno de sus riñones a un desconocido, logrando que se beneficiaran tres personas

The first 'Good Samaritan' non-directed donor in Spain is a priest from Barcelona who initiated a chain of three transplants.

And here's the article from El Pais:
España realiza el primer trasplante de vivo en cadena gracias a un donante altruista
Tres pacientes se han podido beneficiar del procedimiento.- Con este sistema, la ONT espera mantener la elevada tasa de trasplantes de España

See my earlier post about Mike Rees and Spain:

"Una persona altruista puede salvar muchas vidas"

"A selfless person can save many lives"

HT: Rosemarie Nagel and 'Chris F. Masse'

Expectations and reference points: Andreas Fuster

Andreas Fuster successfully defended his dissertation today on various aspects of behavioral economics. The part that was his job talk was his experimental paper, “Expectations as Endowments: Evidence on Reference-Dependent Preferences from Exchange and Valuation Experiments,” written with his fellow graduate student Keith Ericson and forthcoming in the QJE. The high level motivation for the paper is to study carefully in the lab how expectations are important for consumer decisions, and to better understand how expectations are formed. The more particular focus of the paper is reference-dependent preferences, with the idea that reference points are determined by expectations as formulated by Koszegi and Rabin. And the very particular focus of the paper is the recently controversial “endowment effect,” related to experimental observations that subjects seem reluctant to trade objects with which they are endowed.

Andreas and Keith explore whether the “reference point” that subjects form is related more to their expectations about what they may own in the future than to their current endowment. In a very carefully designed experiment, they manipulate expectations by assigning subjects a probability that they will receive an object, or have an opportunity to trade it, and then observe various measures of how subjects evaluate the object as a function of these probabilities.  Their results provide the most convincing support to date of the Koszegi-Rabin model of expectation based reference points.

When asked how he planned to spend the rest of the day, Andreas replied "PhD: pretty heavy drinking."

Welcome to the club, Andreas.