Swimming pools and school performance in Boston

Schools' physical facilities aren't so highly correlated with their reading scores...To put it another way, building a modern new building in a poor crime-infested neighborhood isn't enough to do the job. But different aspects of a school appeal to different families (which is the idea behind promoting school choice...)
Inequities among Boston’s schools: Gaps in facilities, test scores, safety complicate the process

"The Perkins Elementary School in South Boston is barely visible behind rows of nondescript brick buildings inside the Old Colony public housing development. Students make do without the most basic amenities, eating breakfast and lunch at their desks, taking gym classes at a Boys & Girls Club, and checking out books at a neighborhood library.

"About three miles away in a crime-ridden Dorchester neighborhood, the Holland Elementary School stands like a beacon. Nestled among fruit trees, Holland sports two cafeterias that serve freshly prepared meals, an indoor basketball court, an Olympic-size heated swimming pool, a soundproof music room with red and white electric guitars, and a library with more than 7,000 books.

"The stark differences between these two schools extend well beyond their facilities. Perkins, with its bare-bones surroundings, often propels students in early grades to great academic heights on standardized tests, while Holland struggles to get students to understand reading and math fundamentals.
...
""An impressive facility often does not equate with a stellar academic program. Other schools with meager facilities, such as Bradley in East Boston, Hale in Roxbury, and Mozart in Roslindale, had some of the highest reading and math scores on last spring’s Massachusetts Comprehensive Assessment System exams in the third grade. By contrast, some schools with swimming pools - such as Hennigan in Jamaica Plain, Marshall in Dorchester, and Mildred Avenue in Mattapan - landed in the bottom.
...
""The disparities add an agonizing layer to the school-selection process, underway for the next school year, as parents weigh what matters most for their child’s education and happiness: A nice building or solid academics? An outstanding music program or rigorous science instruction? A school near home or one with an after-school program?

"THE UNEVEN distribution of great facilities and programs underpins Boston’s elaborate school-lottery system, which was designed to give students a chance of getting into the best schools, and is also the reason the process is so harrowing. Some students win, gaining access to one of the city’s best schools, while other deserving students are consigned to schools with poor records of achievement, substandard facilities, or both.

“The reality is there are not enough good schools,’’ said Kim Janey, senior project director for the Boston School Reform Initiative at Massachusetts Advocates for Children, a Boston nonprofit."
...
"As Tarso Ramos, a Roxbury father, scouted schools at one of the city’s annual “showcase of schools,’’ held last month at a Jamaica Plain school, he had already conceded that he and his wife may not find the dream school for their son.

“It’s like a series of trade-offs,’’ Ramos said of the school-selection process. “So you figure out the right mix and what you can live without.’’

Nonsimultaneous kidney exchange chains simplify the logistics

There are lots of good reasons why nonsimultaneous extended altruistic donor (NEAD) chains are a good idea, and they have become common since the first one, reported by Rees et al., particularly because they permit more transplants to be accomplished.

But, another reason, as the following story makes clear, is just that they ease the logistics...
Second Patient Kidney Exchange Takes Place in NC

"The first of the surgeries, Dean’s laparoscopic nephrectomy, had been scheduled for 7:30 in the morning, but surgeon Deepak Vikraman didn’t start his work until nearly noon. “Things always start later than they’re supposed to,” Ellis said.

It was just logistical issues, he said. “And because that one was later, that pushed everything back,” Ellis said. “They just had to wait [to do the second set or surgeries] until they got all the logistics straightened out.”

Could the Church of England declare finance to be repugnant?

It looks like they might try: Church leaders accuse bankers of losing their 'moral moorings'

"..."It is hard to imagine a more powerful way of telling someone that they are of little value than to pay them one-third of 1% of your salary," he said.

"Among the ill effects of very large income differences between rich and poor are that they weaken community life and make societies less cohesive."

"He said that "Queen's honours" – meaning peerages, knighthoods and other official honours – should not be given "to those who have already rewarded themselves handsomely".

Kidney transplants in the U.S. prison system

The recent insider trading conviction of hedge fund manager Raj Rajaratnam sheds some light on the situation facing U.S. prisoners with kidney disease: Rajaratnam Said to Be Assigned to Massachusetts Medical Prison

"Raj Rajaratnam, the hedge fund manager sentenced to 11 years in prison for insider trading, was assigned to a federal prison medical center in Massachusetts, according to a person familiar with the matter.
...
"Rajaratnam, who says he has health problems including diabetes and will probably need dialysis and eventually a kidney transplant, was instead assigned by the Federal Bureau of Prisons to the Federal Medical Center Devens, according to the person, who declined to be identified because the matter isn’t public. 
...
"Devens provides dialysis to about 85 inmates, with the capacity for as many as 125, Howard said.

Since 2004, 15 Devens inmates have received kidney transplants, performed at theUniversity of Massachusetts, she said.

Prisoners who receive permission from the Bureau of Prisons enter the national organ donor list on the same basis as patients outside prison, according to Howard. The prison has about 31 inmates who received transplants before they were in custody, she said.

“Mr. Rajaratnam has medical conditions that are managed routinely by the Federal Bureau of Prisons,” Howard said in her affidavit."

Organ donation in Wales

Will Wales change from opt-in to opt-out on deceased organ donation? The discussion continues...

Presumed consent organ donation to be Welsh law by 2015
"The Welsh government says it plans to have a new law in place for presumed consent of organ donation by 2015.

"The legislation would require people to opt out of donating their organs when they die, rather than opting in by signing the donor register.
...
"Opponents say they do not believe it will work and it will hit trust in the system but supporters claim it will save more lives.

"The Welsh government has told the BBC Wales Politics Show that it is planning a system of "soft" presumed consent where family members would still be consulted after a person's death."
******************

Drop organ law says Archbishop of Wales Dr Barry Morgan
"The Archbishop of Wales is urging the Welsh Government to ditch plans for presumed consent for organ donation."
*****************

A call has been made for more research into presumed consent for organ donation as Wales is poised to become the first part of the UK to adopt it.
"A University of Ulster team has found Wales consistently supplies more donors and donations than other UK nations.

"But they say that laws on presumed consent across Europe show mixed results and need further research.

"Presumed consent campaigners say they have raised awareness of the issue, but opponents warn that it could backfire.

"The Ulster team analysed data from NHS Blood & Transplant for all four UK countries between 1990 to 2009, and compared data on registration and donation from other European countries.

The research found that Wales "consistently outperformed" its UK neighbours, both in terms of the percentage of people registered and its organ donation rate, which had been higher than the UK average for most of the past 20 years.

"The authors recommended more research on the issue of presumed consent, which would mean people would have to opt out of becoming donor, or their organs may be used.

The Welsh government is proposing to introduce the system with a proviso that family members should be consulted.

"The idea has the support of bodies like the Kidney Wales Foundation, but it has been criticised by some, such as the Archbishop of Wales, Barry Morgan, who said organs should be donated as a gift and not as an "asset of the state."

"Spain was found to have doubled organ donation rates with a such a system of "soft" presumed consent, but Sweden - which presumes consent - had a similar rate to Germany and Denmark where informed consent operates, as in the UK.

"Further exploration of underlying regional differences and temporal variations in organ donation, as well as organisational issues, practices and attitudes that may affect organ donation, needs to be undertaken before considering legislation to admit presumed consent," the report says.

"Comparison of EU nations, and particularly Spain, indicates that improvement of organ donation rates is unlikely to be achieved by introducing new legislation alone."

Papers on matching by job market candidates

Matching is popular on the economics job market this year, including interesting papers from students other than mine. Here are a few that caught my attention (please let me know of those I've missed).

Azar Abizada at Rochester: Pairwise Stability for Assignment Problem with Budget Constraints
Abstract: We study assignment problem with fixed budget constraints. Examples include assigning students to graduate schools when colleges have fixed budget, a faculty member with a fixed research fund hiring research assistants, a manager assigning workers to different projects where each project has fixed total benefit, assigning post-doctoral candidates to universities with fixed budgets etc. In graduate college admissions, each college has a fixed amount of money to distribute as stipends. Each college has strict preferences overs individual students that can be extended to the group of students. On the other hand, each student is matched with at most one college and receives a stipend from it. Each student has quasi-linear preferences over college-stipend bundles.
    Differently from earlier literature, in this paper, we specify a fixed budget for each college. One other different feature of our model is that colleges value money only to the extend that it allows them to enroll better students. We show that introducing budget constraint results in loosing some of the previous results in the literature. We define pairwise stability and show that a pairwise stable allocation always exists. We construct an algorithm. The rule defined through this algorithm always selects a pairwise stable allocation. This rule is also strategy-proof for students: no student can ever benefit from misrepresenting his preferences. Finally, we show that starting from an arbitrary allocation, there exist a sequence of allocations, each allocation being obtained from the previous one by "satisfying" a blocking pair, such that the final allocation is pairwise stable.

Gabriel Carroll at MIT:  A General Equivalence Theorem for Allocation of Indivisible Objects
Abstract: We consider markets in which n indivisible objects are to be allocated to n agents. A number of recent papers studying such markets have shown various interesting equivalences between randomized mechanisms based on trading and randomized mechanisms based on serial dictatorship. We prove a very general equivalence theorem from which many previous equivalence results immediately follow, and we give several new applications. Our general result also sheds some light on why these equivalences hold by presenting the existing serial-dictatorship-based mechanisms as randomizations of a general mechanism which we call serial dictatorship in groups. The proof technique, a hybrid of explicit bijective and enumerative methods, is cleaner than previous bijective proofs.


Songzi Du at Stanford GSB: Unraveling and Chaos in Matching Markets, with Yair Livne. (Job Market Paper)

Abstract: We show that the timing of transactions is difficult to coordinate in large matching markets. In our model, some agents have the option of matching early before others arrive. Even with a market mechanism that implements a stable matching after all agents arrive, and without any discounting or risk aversion, some agents have incentives to match early. We show that as the market gets large, on average approximately one quarter of all agents have strict incentives to match early, independent of the underlying distributions of types and utility functions. Moreover, as the market gets large, with probability tending to 1 there is no dynamic matching scheme that is stable, even though the market would be stable if it was static.

SangMok Lee at Cal Tech: Incentive Compatibility of Large Centralized Matching Markets
Abstract: This paper discusses the strategic manipulation of stable matching mechanisms. We find that the expected proportion of agents who may obtain a significant utility gain from manipulation vanishes as a market becomes large. This result reconciles the success of stable matching mechanisms in practice with the theoretical concerns about strategic manipulation. We also introduce new techniques from the theory of random bipartite graphs for the analysis of large matching markets.

Taro Kumano at Washington U.  Stability and Efficiency in the General-Priority-based Assignment (2011), [joint with Aytek Erdil], Preliminary draft

Abstract: A school choice problem is a priority-based assignment problem. A priority ranking of a school in practice inherently exhibits indifference relations among the subsets of the set of students. We introduce a general class of priority rankings over sets of students, which captures both indifferences and substitutability. Our notion of substitutability ensures the existence of stable assignments. The characterization of efficient priority structures implies that there is usually a conflict between efficiency and stability. Thus we turn to the problem of finding a constrained efficient assignment, and give an algorithm which solves the problem for any priority structure that falls in our class. In an important application, school priorities that care about affirmative action can be captured by our model, but not previous models in the literature.

Ayse Yazici from Rochester:  Random stable rules and Nash Equilibrium in  two-sided matching problems
Abstract:  We study many-to-one matching problems with firm preferences that satisfy no complementarity and respect the absolute desirability of workers.  We allow for randomization to achieve procedural fairness in centralized matching markets.  Randomization is also a useful device to explore decentralized markets for lotteries may be considered to represent the frictions in these markets.  We analyze stochastic dominance (sd) Nash equilibrium in the game induced by a random stable matching rule. We prove that a unique match is obtained as the outcome of each sd-Nash equilibrium.  Individual rationality is a necessary and sufficient condition for an equilibrium outcome while stability is achieved as the outcome of an equilibrium where firms behave truthfully.  We also study sd-Nash equilibrium of the game induced by a stable matching rule in many-to-many matching problems under the same domain of preferences. We show that all results but the stability of the equilibrium outcome holds in these problems.  Our results provide an implementation of the individually rational correspondence when all agents are strategic and of the stable correspondence when only workers are strategic.

Modern romance in China

World's largest dating event sees 20,000 Chinese search for love

The headline speaks for itself, but the article reveals some local touches.

"At least a third of the attendees were parents, either chaperoning their children, acting as go-betweens for the more bashful, or brokering deals with other parents for arranged romances.
...
"The attendees, meanwhile, had some very rigid ideas about what they were looking for. Men said they wanted a "kind-hearted" wife, not too beautiful and flighty, but modest and homely. The "minimum requirement" for the women meanwhile was straight-forward: a man with his own house, and preferably also a car.
...
"Xue Xiaoyue, meanwhile, said she was already considered an old maid in her home village at the age of 27. "In my village in Anhui, all the girls marry at 20. Any unmarried woman older than 25 leaves town because of the shame. And these days, at 27, I dread going home for the holidays because of the badgering from my parents and relatives." She had travelled 300 miles to attend the event, but still had a strict set of requirements. "I used to be more unreasonable about what I expected, and I put my previous boyfriends under a lot of pressure to do better financially. These days I still would not marry a man without a house, but a joint mortgage might be acceptable," she said."

Friend or food? Horse meat for human consumption, Congress and PETA

Regarding the ban on slaughtering horses to produce horse meat for human consumption, see these previous posts. There have been a rash of recent stories about the recent Congressional reversal on this, including this unlikely story (as reported by the Christian Science Monitor): Lifting horse slaughter ban: Why PETA says it's a good idea

""Congress has found what many may think of as an unexpected supporter in its decision to bring back horse slaughter facilities to the US after a 5-year-ban: People for the Ethical Treatment of Animals (PETA), the often-controversial animal rights group known for campaigns like “fur is murder."

“It's quite an unpopular position we've taken,” Ms. Newkirk says. “There was a rush to pass a bill that said you can't slaughter them anymore in the United States. But the reason we didn't support it, which sets us almost alone, is the amount of suffering that it created exceeded the amount of suffering it was designed to stop.”

"While PETA says the optimal solution is to ban both consumption slaughter and export of horses, it supports reintroducing horse slaughterhouses in the US, especially if accompanied by a ban on exporting any horses at all to other countries.

"There are now plans in over half a dozen states in the South and West to begin horse slaughter processing, a business worth about $65 million a year before Congress defunded the inspection regime. While unpalatable to most Americans, horse meat is eaten in Mexico, Asia, and parts of Europe.

"As Newkirk predicted, the end to domestic slaughter didn't curtail the number of horses being slaughtered for consumption, but, according to a GAO report, may have led to more inhumane treatment of old, abandoned, or neglected equines as greater numbers were instead shipped to Mexico or Canada for slaughter where the USDA doesn't have the authority to monitor the horses' conditions.

"The number of horses exported from the U.S. to Mexico, for example, increased by 660 percent since the de facto ban, the Government Accounting Office reported in June. Almost 138,000 horses were shipped out of the country for slaughter in 2010, compared to the 104,899 horses that were slaughtered domestically in the year before the ban took effect.

“It's hard to call [the end of the horse slaughter ban] a victory, because it's all so unsavory,” Newkirk says. “The [funding] bill didn't mean any horses were spared, but it does mean the amount of suffering is now reduced again.”
******

Zhenyu Lai passes on the following related story, concerning the recent Congressional action (and which includes a video with the headline "Friend or Food?"): Horses could soon be slaughtered for meat in U.S.

""Congress has lifted a de facto ban on the slaughter of horses, a move hailed by Missouri farmers and state political leaders who say the prohibition had inadvertently caused more harm to the animals than good.

"But some animal-rights activists decried the little-noticed provision, which sailed to passage earlier this month and was signed into law by President Barack Obama on Nov. 18. And they vowed to keep the issue alive, pressing for an outright prohibition of horse slaughtering in the U.S."
********
And Divya Kirti points me to a story that ends with 5 Reasons Not to Eat Horse Meat
including 4. Most Americans oppose horse slaughter.
*******
And also this one (which seems to ignore most of the recent history that involved the just repealed ban): The Empathy Test: Why Nobody Cares About Horse Slaughter
*********

And in other horse related repugnance news, Push to Ban New York Carriage Horses Gains Steam
"After campaigning for decades, animal rights advocates are gaining support for legislation that would ban the hansom cabs..."

A heterodox economist looks (disapprovingly) at market design

Ana Santos writes, not-entirely-unsympathetically, about choice architecture and market design, based on her reading of Thaler and Sunstein's book "Nudge...," and my survey article "The Economist as Engineer..." Her remarks include a novel (to me) objection to creating institutions in which individual goals don't conflict with social welfare: in the absence of such conflict, your "ethical muscles" would grow lax from not needing to be used. (Really; see the end of this post...)

Ana C. Santos, "Behavioural and experimental economics: are they really transforming economics?," CAMBRIDGE JOURNAL OF ECONOMICS 35, 4, 705-728, JUL 2011

"The purpose of choice architecture is to prepare contexts of choice to help individuals make better choices, as judged by individuals themselves, or by society as a whole (Thaler and Sunstein, 2003, 2008). Design economics is in turn devoted to the conception of specific allocation mechanisms that aim at coordinating individual actions for the accomplishment of the goals set by the designer (Roth, 2002). Rather than assuming that markets emerge spontaneously and automatically generate efficient allocations of resources, design economics puts at the forefront the complex social engineering processes involved in the building of markets and market-like allocation mechanisms that determine individual outcomes and the aggregate results that are obtained by having people interacting under those mechanisms."
...
"Not only do these proposals retain the fundamental principles of neoclassical economics—rationality and efficiency—they also continue to promote their expansion to various domains of social life. Through the architecture of contexts of choice and the design of market mechanisms, economists are putting their expertise at the service of individual rationality and economic efficiency, within and beyond the traditional domain of economics.


"Choice architecture and design economics promote a particular version of economics imperialism that goes beyond the mere export of its concepts to territories traditionally occupied by disciplines other than economics. They actually aim at inculcating economic calculus in human deliberation and introducing market-like forms of social interaction where they have been absent. In other words, what is at stake here is the deliberate attempt to make society more like its description in neoclassical economic theories, i.e. the performativity of economics (Mackenzie, 2006; Callon, 2007; Mackenzie et al., 2007). Whether or not they have succeeded in this endeavour is an empirical question that cannot be addressed here. For now, it is suffice to note that while taking into account predictable behavioural irrationalities and the opportunistic behaviour of economic agents in their policy proposals, both choice architecture and design economics retain and promote the expansion of the neoclassical concepts of rationality and efficiency in their market-based solutions."

The article includes a novel argument against aligning individual incentives with social welfare:
"In markets people are less compelled to follow non-market norms and values. By aligning self-interest with the interests of others, market mechanisms moreover obviates the need for ethical reasoning; as a result, individuals no longer have the opportunity, as Steve Turnbull puts it, to ‘flex their ethical muscles’ (Frohlich and Oppenheimer, 2003, p. 290). Individuals’ ability to behave in accordance with non-market norms and values, then, will be seriously compromised. On the contrary, living with the tension between the best strategy from a rational, self-interested point of view and the ethically best strategy keeps the ethic imperative active."

Naked hiking is legally repugnant in at least one Swiss canton

Switzerland seems to be a land of contradictions.
The BBC reports, Swiss can ban naked hiking, court rules

"Switzerland's highest court has ruled that local authorities can impose fines on people hiking nude in the Alps.

The federal court threw out an appeal by a man who was fined after hiking past a family picnic area with no clothes on.

"Judges said the eastern canton (region) of Appenzell had been entitled to uphold a law on public decency.

"They said the ban on naked hiking was only a marginal infringement on personal freedom.

...

"The BBC's Imogen Foulkes in Geneva says naked hiking is an increasingly popular pastime in Switzerland.

"However, Appenzell is a deeply devout and conservative canton - it only granted women the right to vote in 1990 - and the influx of naked hikers has offended many local people, she adds."

College admissions, exams, and "clearing" in Britain

The Telegraph reports: Academic condemns 'tortuous' university admissions

"Mary Beard, the Cambridge University classics professor, said the admissions system employed in Britain was “more difficult and stressful than it should be”.

...

"The comments were made after the Universities and Colleges Admissions Service proposed a sweeping overhaul of the current system.

"They are planning to allow students to apply for places after receiving their results for the first time in a move that would lead to A-levels being brought forward and candidates choosing courses over the summer.

...

"Currently, students are supposed to apply to Oxbridge by October – around a year before courses start – and to other universities in January. Candidates are then given provisional offers based on the proviso that they gain predicted exam grades the following summer.

"Those who fail to score high enough in A-levels and other qualifications are eligible for “clearing” – the system that matches students to spare places.

"But writing on BBC online, Prof Beard said: “More than anything, it is the bizarre timetable that makes the application process so preoccupying.

“When we say in January or February that someone ‘got in’ to their chosen university, we don't actually mean that. We mean that they will have got in if they achieve the grades demanded by the university in their summer exam, which even if all goes well, drags out the nail biting for a good six months.”

"She added: “If it doesn't go well and they don't get the grades, they enter a whole new round of applications in August.

“This is a frenetic process, with applicants tracking down the remaining unfilled places by email and phone - then being given maybe a few hours to accept a place for a course they haven't really explored at a university they know little about.”

Buying and selling pensions

Does buying future payoffs on someone else's pension become more or less repugnant if that person is in financial distress? (This is an aspect of repugnant transactions and markets that is one of the toughest to focus on, having to do on the one hand with the motivation for the transaction and on the other with ideas about coercion and exploitation...)

The WSJ reports on the mainstreaming of investment opportunities to buy the income stream from pensions:  Investing in a Stranger's Retirement

"The burgeoning business of investing in someone else's pension has never been easier—or more controversial and risky.

"For pensioners who are eager to sell, websites beckon with names such as BuyYourPension.com and pension4cash.com. Financial middlemen then bundle the information from pensioners into spreadsheets that are supplied to financial advisers for their clients.
...
"No one keeps track of how many pensions are turned into instant cash, and the number for now is believed to be small. But in recent months, websites have proliferated, and obscure middlemen far from Wall Street have ramped up efforts to win over financial advisers to the concept. They are finding some acceptance among those who favor alternative investments as part of an overall diversified portfolio.

"It's becoming more of a staple part of our business," said Daniel Cordoba, founder of Asset Exchange Strategies LLC, a Leander, Texas, financial-advisory firm that has sold a handful of pension-payment deals to clients in recent weeks. "There's a starvation for yield" with most bonds paying little interest, and clients are scared of the volatile stock markets, he added.
...
"In general, pension deals thread the needle of federal law that discourages the assignment of pensions for public policy reasons, according to court rulings. In a preliminary ruling in August, a California state-court judge said that military-pension transactions by Structured Investments Co., which has been in business since the 1990s, are "prohibited and unenforceable."

Brett Rubin, a lawyer for Structured, said the firm believes its transactions are proper. Over the years, its agreements have been enforced by other courts, including a U.S. bankruptcy court, according to court filings.
...
"Several buyers of pension payments who were interviewed by The Wall Street Journal declined to be identified because they didn't want to be seen as profiting from anyone's financial desperation.

"I had misgivings at first," said an investor in Philadelphia who this summer bought seven years of pension payments from a retired sailor. She forwarded $50,000, to be repaid in monthly installments that includes 6% annual interest.

"As part of the deal, the woman got some information about the seller, including that he needed the money to escape foreclosure. The retired sailor's "distress" bothered her, she said, but she "concluded this would help him save the house."

Legacies in college admissions

The NY Times writes about the burden of having a parent who went to an Ivy League college: Being a Legacy Has Its Burden

But, for all the angst and pressure, there are some compensations:

"...among legacy applicants for Princeton’s class of 2015, 33 percent of those offered a spot were the children of alumni. Harvard generally admits 30 percent, and Yale says it admits 20 percent to 25 percent. For all three, the overall rate is in the single digits.

"According to “The Impact of Legacy Status on Undergraduate Admissions at Elite Colleges and Universities,” a study of 30 colleges published in June in Economics of Education Review, the closer the relation, the greater the benefit: children of parents who attended a school as an undergraduate saw a 45 percentage point increase in the probability of admission; for children of graduate students — or those who had a relative other than a parent attend — the increase in probability was about 14 percentage points.

"Over the long haul, though, legacy enrollment has declined. In 1980, 24 percent of Yale’s freshman class had a parent who had attended, but in the class of 2014, 13 percent were legacy students. At most Ivy League schools, 10 percent to 15 percent of those who end up enrolling are the children of former students.

"And with college enrollment at an all-time high, admittance has become tougher for everyone; acceptance rates are far lower than a generation ago. An applicant from the Harvard class of 1985 would have faced an admission rate of 16 percent, compared with 6 percent for the class of 2015."

A kidney donor argues that selling kidneys should be legal

An op-ed in today's NY Times, by Alexander Berger, scheduled to donate a kidney on Thursday: Why Selling Kidneys Should Be Legal

He'll start a non-directed donor chain, but donors are still in desperately short supply.

Here's his market design argument:


"It has been illegal to compensate kidney donors in any way since 1984. The fear behind the law — that a rich tycoon could take advantage of someone desperately poor and persuade that person to sell an organ for a pittance — is understandable. But the truth is that the victims of the current ban are disproportionately African-American and poor. When wealthy white people find their way onto the kidney waiting list, they are much more likely to get off it early by finding a donor among their friends and family (or, as Steve Jobs did for a liver transplant in 2009, by traveling to a region with a shorter list). Worst of all, the ban encourages an international black market, where desperate people do end up selling their organs, without protection, fair compensation or proper medical care.

"A well-regulated legal market for kidneys would not have any of these problems. It could ensure that donors were compensated fairly — most experts say somewhere in the ballpark of $50,000 would make sense. Only the government or a chosen nonprofit would be allowed to purchase the kidneys, and they would allocate them on the basis of need rather than wealth, the same way that posthumously donated organs are currently distributed. The kidneys would be paid for by whoever covers the patient, whether that is their insurance company or Medicare. Ideally, so many donors would come forward that no patient would be left on the waiting list.

In the end, paying for kidneys could actually save the government money; taxpayers already foot the bill for dialysis for many patients through Medicare, and research has shown that transplants save more than $100,000 per patient, relative to dialysis."

The role of recruiting in hiring and career choice

Matching is the part of economics that studies who gets what, for things that are not allocated entirely by price. So, if there's an application or admission or recruitment or selection process, we're probably in the domain of matching.

A recent article by Marina Keegan, a Yale undergraduate, points out that the high percentage of Ivy undergrads who go into consulting and finance may have to do with how well those places recruit: Another View: The Science and Strategy of College Recruiting.

She writes:
"Sometime between freshman fall and senior spring, an insane number of students decide – one way or another – that entering the banking industry makes a whole lot of sense. A few weeks ago I interviewed over 20 Yalies to try to figure out why.

"What I found was somewhat surprising: the clichéd pull of high salaries is only part of the problem. Few college seniors have any idea how to “get a job,” let alone what that job would be. Representatives from the consulting and finance industries come to schools early and often – providing us with application timelines and inviting us to information sessions in individualized e-mails. We’re made to feel special and desired and important."
********

Vikram Rao, who brought the article to my attention, writes
"... I thought one of the interesting points of the article is that these companies do a very good job of getting to the best students quickly (seems like an unraveling market) by recruiting in the fall, spending lots of money on recruiting, and presenting students with a well-defined process. I know from personal experience having gone to Princeton that they also do a very good job of outlining the parameters of the job market (i.e. if you intern with us/apply for full time with us at this time, then you will receive an offer at time X for Y dollars with roughly Z probability). Their interview process is also extremely efficient. The article makes the point that most college students don't really know how to find a job. These companies eliminate a lot of this uncertainty by having such well-established recruiting timetables and processes.

"Having just gone through the post-collegiate job market, I can say that this alone is worth a lot. In addition to lower salaries, the majority of other professions do not present such a clean-cut "do this, then this, then this" approach to recruiting and instead require that you go through contacts or wait long periods of time without much certainty to get a job. The banks and consulting firms also do a good job of convincing applicants that "if you work here, you can do a, b, or c afterwards", whereas many other industries do not make such claims. This is an interesting market design perspective on I-banking and consulting recruiting - I don't think America's youth is suddenly much greedier than it once was and is drawn by large salaries. Certainly some people are, but not all. I think what the I-banking and consulting firms really offer is 1) they recruit early, 2) they offer a very well-understood process towards getting a job, and 3) a clear vision of your future (I make no claim as to whether or not this vision is accurate or not). Graduates of top schools are used to getting results when they put their minds to something and tend not to like uncertainty. "
******

A similar view, from the point of view of what career counseling offices do, is expressed by Peter Bozzo, writing in the Harvard Crimson: Profits and Bridges

"The more intriguing question is why students—many of whom, like me, were inspired to create during their years at Harvard—eschew careers in the more “creative” professions and pursue work in the financial world. Why are we creating profits instead of bridges?

I think that much of the answer has to do with the resources devoted to career counseling for students whose interests point them toward occupations outside the world of finance and consulting. Certainly some students enter this world because of the financial benefits, but for others it’s simply the most visible and defined career path after graduation. Students can meet with recruiters and interview on campus; the Office of Career Services provides extensive counseling for undergraduates pursuing finance or consulting careers. Many students work in internships during the summer after their junior year; by the end of the summer some have job offers in hand and can go through senior year with defined post-graduation plans while their friends frantically search for job listings and interview opportunities.

"Searching for a career outside finance or consulting often comes with more uncertainty than searching for a career within this profession. As a result, students often need to be counseled extensively when searching for opportunities in non-finance fields. Opportunities for such counseling currently exist at Harvard, but they often aren’t advertised extensively and can be overshadowed by the highly visible recruiters who descend on campus each year. The OCS could more effectively highlight its counseling opportunities for students interested in engineering, politics, or academia and could more aggressively reach out to students interested in these fields. Currently, OCS’s extensive finance career counseling services are not an example of a response to students’ demand for careers in these fields; instead, the supply of these services inflates demand for careers that might not otherwise be as attractive to students.

"As seniors near their thesis deadlines and eventually their graduation dates, thoughts of post-college plans inevitably hang over their heads. Right now, the ease of enter the consulting and finance fields means that students with diverse interests and creative impulses are streamlined into these professions, even if they’re more willing—and more suited—to entering other occupations. So why are we creating profits instead of bridges? It’s not because we’re uncreative; it’s because profits—and the careers associated with them—simply come easier."
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The Occupy Harvard movement seems to agree: Occupy Harvard Rally for Free Speech Targets Goldman Sachs Recruiting Event

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Of course, recruiting isn't something that can only be done by some kinds of employers.Teach for America is also known for the good job it does: see my recent post on that...

Teach for America's recruiting at Harvard

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And here's a report by Bryan Caplan on a paper about what hiring looks like (in contrast) at firms whose recruiters look at applications while commuting on the train and in other stolen moments :
How Elite Firms Hire: The Inside Story

The blackest of kidney black markets

Can some black markets be blacker than others? Two longtime observers of black markets for kidney transplants nominate some.

Ethan Gutmann writes chillingly of The Xinjiang Procedure: Beijing’s ‘New Frontier’ is ground zero for the organ harvesting of political prisoners.

"Thirty-six scheduled executions would translate into 72 kidneys and corneas divided among the regional hospitals. Every van contained surgeons who could work fast: 15-30 minutes to extract. Drive back to the hospital. Transplant within six hours. Nothing fancy or experimental; execution would probably ruin the heart. 

"With the acceleration of Chinese medical expertise over the last decade, organs once considered scraps no longer went to waste. It wasn’t public knowledge exactly, but Chinese medical schools taught that many otherwise wicked criminals volunteered their organs as a final penance. 

"Right after the first shots the van door was thrust open and two men with white surgical coats thrown over their uniforms carried a body in, the head and feet still twitching slightly. The young doctor noted that the wound was on the right side of the chest as he had expected. When body #3 was laid down, he went to work. "

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And Nancy Scheper-Hughes writes of The Rosenbaum Kidney Trafficking Gang, and of kidney black markets more broadly (as well as of her difficulties in getting others to see these things as she sees them).

"Some of the victims of US organs trafficking are bonded servants from Syria and Jordan brought into the US to provide kidneys to their patron royal families from the Gulf States. The Cleveland Clinic has a transplant wing that for many years has catered to these so-called “transplant tourists.” UCLA had its heyday with wealthy Japanese Yakuza crime “family members” who were given priority for liver transplants from the UNOS waiting list, livers that technically belonged to US citizens.

"So, Rosenbaum’s network, though extensive, represents only one of many forms of transplant trafficking into and out of the United States. Transplant trafficking is a public secret within the transplant profession, something that everyone knows about but which within the corporatist culture of the transplant profession — as secretive as the Vatican — is never discussed.
...
"Caught in the dragnet Rosenbaum admitted that he charged a lot to set up these illegal transplants in some of the best hospitals on the east coast, including Mount Sinai in NYC , Albert Einstein in Philadelphia, and Johns Hopkins in Baltimore.
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"Nobody cared about, or even believed in, human trafficking for organs. I went to the media, to CBS, to 60 Minutes and then to 48 Hours which did send an investigative reporter, Avi Cohan, to meet me in Israel where we spoke to patients who had had “undercover” transplants at hospitals in NYC Philadelphia, the Bay Area, and Los Angeles. CBS decided not to do the exposé. I was stumped. No one wanted to accuse surgeons, or prevent a suffering patient from getting a transplant, even with an illegally procured kidney from a displaced person from abroad. The Israeli origins of the trafficking network did not help either. It smacked of bias, blood libel, or worse. “Don’t Indians and Pakistanis broker more kidneys than Israelis”, I was asked? Why pick on Israel?
...
"What I imagine is that the complicit surgeons loved the Rosenbaum option because they didn’t have to go through UNOS, the United Network for Organ Sharing, which until 2007, had nothing to do with living donors, related or unrelated. Hospital administrators loved it because foreign patients paid cash so there was no waiting for Medicare or insurance premiums. And there was minimal responsibility for the aftercare of the recipients or their kidney providers. Both were speedily returned to their respective communities and countries. Should they ever get caught red-handed, surgeons can cite patient confidentiality (their privacy oath), the hospitals could pretend they had been duped, the transplant coordinators could say that they followed the transplant protocols for living donors, but they are not, after all, detectives. Everybody wins. Lives were ‘saved’, transplant surgeons got to do what they do best, poor people got a ‘bonus’ for being charitable with their ‘spare’ kidneys, and everybody was happy.
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"Meanwhile, complicit transplant doctors collude and protect each other, while the best ones tried to fix the problem from inside the profession without the help of the DOJ or the courts getting involved. Bioethicists argue endlessly about the “ethics” of what is in fact a crime and a medical human rights abuse. Economists and moral philosophers launch arguments based on rational choice theory for regulation rather than prosecution, as if prosecutions were going on every day. In fact, as the Rosenbaum history shows so well, human trafficking for organs is a protected crime. It is protected by the charisma and awe-inspiring ‘ miracle’ of transplant. The Rosenbaum guilty plea is the first prosecution in the United States for organs trafficking. On February 2nd Rosenbaum could be sentenced to five to 12 years in prison and a fine for illegally brokering organs in New Jersey. But the larger and deeper story of his international kidney dealings, his hired traffickers, kidney hunters, ‘enforcers’, money laundering operations, false charity organizations, Medicare fraud is yet to be told. And in the meantime, “life saving” for some at the cost of diminishing the lives of others ,the invisible kidney sellers of Chernobyl, Kiev, Nazareth, or the Negev desert, will continue undeterred.

Kidney sales and trafficking

There have been a number of recent stories about criminal organ-trafficking rings around the world.  Here's a long quote from the one that seems most credible, from Bloomberg (in which Frank Delmonico is among those quoted), followed by links to two related stories.

Organ Gangs Force Poor to Sell Kidneys for Desperate Israelis
"Aliaksei Yafimau shudders at the memory of the burly thug who threatened to kill his relatives. Yafimau, who installs satellite television systems in Babrujsk, Belarus, answered an advertisement in 2010 offering easy money to anyone willing to sell a kidney.

He saw it as a step toward getting out of poverty. Instead, Yafimau, 30, was thrust into a dark journey around the globe that had him, at one point, locked in a hotel room for a month in Quito, Ecuador, waiting for surgeons to cut out an organ, Bloomberg Markets magazine reports in its December issue.

...

"Organ trafficking is on the rise, as desperate people seek transplants in a world that doesn’t have enough donors. About 5,000 people sell organs on the black market each year, according to Francis Delmonico, an adviser on transplants to the World Health Organization.

It’s against the law to buy or sell an organ in every country except Iran, says Delmonico, who is president-elect of the Montreal-basedTransplantation Society, which lobbies governments to crack down on illicit procedures.

‘Exploit Shortages’

“There have been successes fighting organ trafficking around the world,” Delmonico says. “But organ trafficking continues to flourish because criminals exploit shortages of organ donors.”

Bloomberg Markets reported in June that U.S. citizens and others from the Americas suffering from kidney failure were going to Nicaragua and Peru to buy organs in a shadowy trade that injured and killed donors and recipients.

That U.S.-Latin American connection is dwarfed by a network of organ-trafficking organizations whose reach extends from former Soviet Republics such as Azerbaijan, Belarus and Moldova to Brazil, the Philippines, South Africa and beyond, a Bloomberg Markets investigation shows.

Many of the black-market kidneys harvested by these gangs are destined for people who live in Israel.

...

"Delmonico, a professor of surgery at Harvard Medical School, has spent the past six years lobbying governments and doctors around the world to combat organ trafficking. He says Israel’s government is cracking down.

The Knesset, Israel’s legislative body, passed the Organ Transplant Law in 2008, setting penalties, including imprisonment of up to three years, for buying and selling organs and requiring hospitals to scrutinize transplants by nonrelatives and foreigners.

Breaking up Gangs

In an effort to draw more legal organ donors, the law also offers volunteers compensation for lost wages and travel expense and provides them with additional health insurance. Israeli police have been among the most aggressive in the world against organ traffickers, breaking up three international gangs since 2008.

The government has also banned insurers from funding most transplants outside Israel.

The dearth of available organs in Israel has spawned a new class of criminals, mainly immigrants from the former Soviet Union, says Jerusalem Police Superintendent Gilad Bahat.

Investigators on five continents say they have uncovered intertwining criminal rings run by Israelis and eastern Europeans that move people across borders -- sometimes against their will -- to sell a kidney.

“The criminal here is the middleman who profits from the sick and the poor,” says Bahat, who investigated an organ- trafficking ring in Jerusalem. “It touches my heart that people will sell part of their body because they need money to live.”

...

"The Brazilian case is still wending its way through international courts. In November 2010 in Durban, Netcare Ltd. (NTC) -- South Africa’s largest hospital company -- pleaded guilty to violating the Human Tissue Act, which prohibits buying and selling organs.

Netcare paid 7.8 million rand ($848,464) in fines and penalties. It admitted to allowing 92 transplants in which donors from Brazil, Israel and Romania sold kidneys to Israeli patients. Four doctors are awaiting trial on trafficking charges.

In Brazil, 12 people connected to the Netcare case were convicted and jailed, with sentences from 15 months to 11 years.

In Kosovo, Ratel, who has dual citizenship in Canada and Great Britain and was appointed by the European Union to help restore the country’s criminal justice system, is overseeing a pivotal organ-trafficking case. It includes participants and victims from Belarus, Moldova, Turkey and four other countries.

Center for Trafficking

The EU has administered the courts in Kosovo since 2008, the year the country the size ofConnecticut declared independence from Serbia after a civil war. Ratel, who arrived in March 2010 as part of the European Union Rule of Law Mission in Kosovo, says the country has become a center for organ trafficking.

Ratel built a case against nine doctors, hospital administrators and recruiters on charges of buying and selling kidneys for patients in Georgia, Germany, Israel, Poland and Ukraine, as well as Canada and the United States.

...

"“This is organized crime,” Ratel says. “There is significant coercion and threats of violence.”

Organ traffickers search the world for hospitals willing to perform illicit transplants. Sometimes, sellers are flown to cities just to wait for procedures, and then traffickers move them to other parts of the globe when they find a recipient and a hospital willing to cooperate.

While the illegal organ trade may be run by seasoned criminals, it depends on the complicity of doctors and hospitals, says Oleg Liashko, a member of Ukraine’s parliament.

“I doubt this could happen without the hospital and doctors knowing about it,” says Liashko, who has investigated organ trafficking and is calling for more-severe criminal penalties in organ transplant laws. “They either know or look the other way because of the money involved. This is corruption, pure and simple.”

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Here's a story that follows up on the U.S. side: Kidney Broker Said to Use Johns Hopkins in Organ-Traffic Case
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And here's a graphic (but probably less credible) story from Egypt: Refugees face organ theft in the Sinai