Patent denied for the idea of matchmaking

Those of you who may occasionally have tried to play matchmaker will be relieved to know that you are not infringing on a patent for that practice.

"Six months ago, a shell company called Lumen View Technology told Santa Barbara startup FindTheBest that it should pay $50,000 for infringing its patent on "multilateral decision-making." Instead of getting a quick payout, it ran into FindTheBest founder Kevin O'Connor and a RICO lawsuit.
...

In her ruling (PDF) issued late Friday, US District Judge Denise Cote noted that Lumen View was trying to patent "matchmaking," a practice that is literally ancient. She cited the patent specification, which included examples like "having a computer match employees and employers whose desired attributes and intensities of preferences mutually align." Another brainstorm from the patent is having a computer match "college applicants and... colleges seeking applicants," according to their preference data."

 HT: Scott Kominers

Anthropology celebrates Scheper-Hughes for her work on the illicit trade in organs

Dr. Nancy Scheper-Hughes Named First AAA Public Policy Award Winner

"The American Anthropological Association (AAA) is pleased to announce that its Committee on Public Policy has selected medical anthropologist Nancy Scheper-Hughes as the first recipient of the new Anthropology in Public Policy Award. Dr. Scheper- Hughes is a nationally-recognized expert on several important health issues, including hunger, illness and organ trafficking.
...
"Dr. Scheper-Hughes’ body of work and research, especially in the area of organ trafficking, has shaped how governments and international bodies address the issues of illegal transplantation.

"In 1999, Scheper-Hughes helped found the Berkeley Organs Watch Project, an organization dedicated to research on human organ traffic worldwide, including examining the transnational networks that connect patients, transplant surgeons, brokers, medical facilities and so-called “live donors.” Almost ten years later, in 2008, her investigation of an international group of organ sellers based in the East Coast of the United States and Israel led to multiple arrests by the Federal Bureau of Investigation. In recent years, she has served as an advisor or consultant to the European Union; the United Nations, Division of Law Enforcement, Organized Crime and Anti-Laundering Office on Drugs and Crime, and the Human Trafficking Office of the World Health Organization in Vienna. She has also testified as an expert before the US Congress, the Council of Europe and the British House of Lords.

Some history of the Common App

The Chronicle of Higher Ed has a long, informative article on the Common App and the recent troubles with its computer systems, from which I excerpt below:

The Uncommon Rise of the Common App

Although the Common Application is now a vast, bustling highway, it was once just a shortcut. Its founding purpose: to make applying to college easier.

Back before the computer, applicants and counselors had to write or type answers to the same questions on every college's application. Each year the nation's hands cramped up. Then, in 1975, Colgate University, Vassar College, and a handful of other private institutions with similar admissions requirements created a common form that students could photocopy and mail in.

This modest stand against redundancy was infused with a high-minded mission: increasing access by going beyond grades and test scores to conduct robust evaluations of each applicant. "It was a time for reaffirming what was important in admissions," says Mary F. Hill, a former dean of admissions at Colgate who served on the Common Application's board of directors from 1996 to 2005.

...

By the mid-1990s, more than 150 colleges—all private, all relatively selective—were using the Common Application, run by a network of volunteers. In 1996 the National Association of Secondary School Principals dedicated a staff member to handle logistics and the increasing volume of paperwork. The application then was a booklet of perforated forms with maroon type; the masthead listed participating colleges in small print. Each year, as more names were added, the letters shrank.

The Common App first went online in 1998. To keep up with growth, the board hired a staff and incorporated as a nonprofit organization. It also agreed to admit public universities, the first six of which joined in 2001.

...

At least until this fall, ease of use has made the Common App a success by any measure. According to its tax return for 2011, the organization, based in Arlington, Va., generated $13-million in revenue. Of the group's 517 members, 178 offer no other way to apply. The fee structure rewards exclusivity. Nonexclusive members pay $4.75 per application; exclusive members pay $4. Colleges that further "streamline" their policies—by having no more than two early-admission plans, for instance—pay only $3.75. All nine admissions officials on the organization's board represent exclusive users.

The Common Application now has nine employees, but it expects to grow to 65. Next summer, as part of a long-term acquisition plan, the organization will hire about 30 employees who now work for a company called Hobsons, which designed and developed the new online system. (Hobsons also owns Naviance, which high schools use to send documents to colleges, and the website College Confidential.)

In the admissions profession, the Common App is ubiquitous. This year it was the lone platinum sponsor of the National Association for College Admission Counseling's annual conference, for which it paid $50,000. (The Chronicle was also a sponsor of the event.) Recently the Common App gave the association $80,000 to send 80 college counselors to a professional-development workshop. Each year it mails a poster to every high school in the nation, listing its ever longer roster of colleges.

With visibility comes cachet. Joining the Common Application in 1990 was an important move for Ursinus College, says Richard G. DiFeliciantonio, vice president for enrollment. "There was status associated with that membership," he says. "It confirmed our position in the marketplace."

Now he believes the benefits have less to do with prestige than with scale. The wider a college's recruitment net, the more applicants of every kind it can attract. He credits the Common App with helping Ursinus double its enrollment of both nonwhite students and those eligible for federal Pell Grants.

Mr. DiFeliciantonio also sees trade-offs. With more applications, "yield"—the percentage of accepted students who enroll—declines and becomes harder to predict. (A law of recruitment: More applicants doesn't necessarily mean more serious applicants.) And member colleges must relinquish some authority over the questions they can and cannot ask. "We were willing to put up with a loss of control," he says, "to get with the herd."

...

The Common Application is not without competitors. College­NET, an Oregon-based technology company, builds customized application-processing systems for some 500 colleges worldwide. After creating an account through, say, Washington State University, a student can automatically transfer basic information to another member college that has signed on to that service.

...

Joshua J. Reiter, who helped build the Common Application's first online system, went on to start the Universal College Application in 2007. The for-profit company is a small rival, for sure: Membership peaked at about 80 colleges a few years ago, then dwindled to 32, in part because those that also belonged to the Common App decided it was simpler to manage just one system. But since problems with the Common Application arose, Princeton University and seven other colleges have joined or rejoined the Universal College Application, which admissions deans say charges $1,000 annually, plus $4.50 per application.

...

Timeline: The Common Application, 1975-2013

1975: The Common Application begins a pilot program with 15 member institutions, primarily selective liberal-arts colleges.

1980: Passes 100 members.

1994: Harvard U. becomes the first Ivy League member; Dartmouth College follows the next year.

1998: First online application system launches.

2000: The Common Application incorporates as a nonprofit; passes 200 members.

2001: The Universities of Delaware, Vermont, and Maine are among the first public institutions to join.

2004: Binghamton University becomes the first State University of New York campus to join; by 2011, 18 other SUNY campuses will have joined.

2007: Passes 300 members.

2010: First international institutions join; passes 400 members; number of unique applicants exceeds 500,000.

2013: Paper application is retired; passes 500 member institutions; fourth generation of the online application faces technical difficulties and criticism.

Uruguay legalizes commerce in marijuana

Uruguay becomes first country in the world to legalise marijuana trade

"Uruguay has become the first country to legalise the growing, sale and smoking of marijuana, a pioneering social experiment that will be closely watched by other nations debating drug liberalization.
A government-sponsored bill approved by 16-13 votes in the Senate provides for regulation of the cultivation, distribution and consumption of marijuana and is aimed at wresting the business from criminals in the small South American nation.
Backers of the law, some smoking joints, gathered near Congress holding green balloons, Jamaican flags in homage to Bob Marley and a sign saying: "Cultivating freedom, Uruguay grows."
Cannabis consumers will be able to buy a maximum of 40 grams (1.4 ounces) each month from licensed pharmacies as long as they are Uruguayan residents over the age of 18 and registered on a government database that will monitor their monthly purchases.
When the law is implemented in 120 days, Uruguayans will be able to grow six marijuana plants in their homes a year, or as much as 480 grams (about 17 ounces), and form smoking clubs of 15 to 45 members that can grow up to 99 plants per year."
...
"Uruguay's attempt to quell drug trafficking is being followed closely in Latin America where the legalization of some narcotics is being increasingly seen by regional leaders as a possible way to end the violence spawned by the cocaine trade.
Rich countries debating legalization of pot are also watching the bill, which philanthropist George Soros has supported as an "experiment" that could provide an alternative to the failed U.S.-led policies of the long "war on drugs."
The bill gives authorities 120 days to set up a drug control board that will regulate cultivation standards, fix the price and monitor consumption.
The use of marijuana is legal in Uruguay, a country of 3.3 million that is one of the most liberal in Latin America, but cultivation and sale of the drug are not."

Unraveling in Belgian soccer: an under 2 year old signed to pro club's under 5 team

First, there is an "under 5 team." And that's the one that's unraveling.

20-MONTH-OLD BABY BECOMES WORLD’S YOUNGEST PRO FOOTBALLER
"Bryce Brites is only 20 months old and can’t even properly utter the words “ball” or “goal” but he just became the youngest professional football player on the planet.

This past week, Bryce signed with Belgian club FC Racing Boxberg, based near his home city of Genk, after impressing coaches with his “highly unusual” talent and “incredible” ball control. The precocious toddler was invited to train with the club’s Under-5 team and was signed and issued his very own Belgian FA membership card the very same day.

Amazingly, Bryce misses out on the all-time record for youngest-ever professional by two months. That record apparently belongs to Dutch footballer Baerke van der Meij, who signed a 10-year deal with VVV-Venlo when he was 18 months old."


HT: Juan Sebastián Pereyra Barreiro
***************

Update: videos here

Urban poverty: an opportunity for change in Richmond, VA

The city of Richmond, VA seems to be engaged in some innovative attempts to alleviate urban poverty, and in studying the sometimes counterproductive incentives and choices that face those who are trapped in it.

Jamison Manion, who is administering the city's workforce development program reached out to me and, in a series of discussions, convincingly made the case that Richmond is very open to partnering with academic researchers who would be interested in studying the obstacles to entry in the labor force, and crafting policies to overcome these. It sounds like they have data...so it could be an opportunity for some economist interested in poverty, cities, and labor force participation.

Here are two news stories and a presentation by Manion to the City Council.

NY Times:

http://www.nytimes.com/2013/10/15/us/richmond-awaits-a-bold-antipoverty-plan.html?_r=0

Style Magazine:

http://www.styleweekly.com/richmond/lifting-all-boats/Content?oid=1992584

(NOTE: The young man featured in this article was just offered a position as an Electrician’s Helper today)

Presentation to City Council: Feb 2013

http://vimeo.com/64572373

Interested researchers can contact Manion directly...

Jamison Manion
Programs Administrator for Workforce Development
Center for Workforce Innovation
City of Richmond, VA
jamison.manion@richmondgov.com

Behavioral economics in British government: NY Times

Britain’s Ministry of Nudges

013

Uploading letters of recommendation to grad schools and academic jobs

The time of year when I write letters for undergrad students applying to grad schools, and graduate students applying for jobs, is just ending. There are a bunch of services via which letter writers are asked to upload their letters. Some (further) consolidation would be efficient.  Below are some reflections on the process of uploading letters (I didn't send any through the U.S. Post Office this year.)

Uploading recommendations for graduate school
**************
ApplyYourself, Inc. has sold software to many schools.
"This online Recommendation service is provided by ApplyYourself, Inc. ("ApplyYourself"), a subsidiary of Hobsons, Inc.. ApplyYourself provides online Recommendation services for educational and other institutions."

It asks you to set a new password for each graduate program, and doesn't link to the accounts with the same password that I've already set up for other graduate programs at that university, not to mention for other schools. Multiple graduate programs in the same school need to have the same information added each time. It requires complicated passwords:
In order to begin your online Recommendation for xxx, you first need to create your password. After creating your password, you will be logged in automatically and will find further instructions on how to complete the Recommendation. Password must be between 8-30 characters, contain at least 1 uppercase letter (A-Z), 1 lowercase letter (a-z), 1 number (0-9), and 1 of the following special characters: !@#$%^&*()_+|~-=\`{}[]:";'<>?,./ Spaces are not allowed."

When submitting multiple letters to the same school you sometimes get this:
"An error has occurred. You either have more than one connection to this website or you did not properly log out of your last session. Please close all browser windows, then open a new browser window to access this site.Also, please be sure to logout of all future sessions to prevent this situation. Once logged in, you can logout by clicking on the 'logout' link located in the upper right hand corner of the page."
*****************
CollegeNET Letters of Recommendation is a service used by several universities, and when I log on I can see multiple (in this case 2) letter requests.  I can't submit one letter, but have to submit it again for each application. But at least I didn't have to logout and log in again...  Some universities (Princeton is one) ask you lots of questions that have to be filled in on a web form before you can proceed to upload your letter. Here's the kind of error message you get for not filling in some essential detail about yourself, like your zip code.
The data you just supplied contains 1 omission or datatype mismatch.
This problem will have an explanation above it.
Both the explanation and the problem will be in a box.

Data Validation:

Some fields are required by the institution to have a value.
Other fields need the data to satisfy length limitations
or certain formatting constraints.
Once these corrections are made,
the form will be ready for submission

Once you succeed in submitting the letter, it signs off with this helpful suggestion
You should print or save this page for your records. The information below can be used to track your form should you have any questions.
*******************
Law Schools use a service provided by the Law Schools Admissions Council
LSAC Evaluations is now LSAC Applicant References
It requires you to open an account, complete with security questions such as "what is your favorite number?"  It took me many attempts before finding a username and password that it would accept.
When I tried to upload my letter, I got an error message saying that they didn't accept pdf files.  Fortunately it accepted a .docx file. But after it has been slowly uploaded, you have to proofread it and check a box certifying that you have before the very slow webpage digests it...

********************************************
********************************************
Uploading jobmarket letters for economists is by and large easier than uploading letters for admission to grad schools, and my impression is that it is somewhat easier than jobmarket letters for other disciplines. This is largely due to the large market share presently enjoyed by econjobmarket.org, which makes it easy to upload a generic letter that will be sent to each of the employers enrolled on econjobmarket.org to whom that student has applied.  (I recalled from previous years that with somewhat more effort you can upload different letters to be sent to different employers. This year I had trouble figuring out how to do that, but minutes after sending a query on the contact page got a reply that explained how to do it--the key is to find where to turn off autodelivery:)

Their competition comes from two directions. One is from similar services, some of which are discussed below. In economics, these command a much smaller part of the market, i.e. each letter uploaded to them goes to fewer employers. The main competition to econjobmarket.org is software companies that sell a platform to universities for all of that university's applications. That is, for many letters of recommendation, you go to the university web site to upload your letter. There must be only a few software suppliers, since many of these sites look the same.

Here are some notes, first on two upload platforms, then on two fairly typical university sites.

AcademicJobsOnline  didn't make it easy to see which jobs were being applied to, hence it encouraged a generic letter that could be sent to any academic position. This is the feedback you get after uploading a letter.

AcademicJobsOnline.org	Refs * Jobs * Employers * Help * Logout

Done Reference Letter Submission: Confirmation

Your letter has been successfully submitted. This is the final confirmation; no more confirmation or receipt will be sent by email.  

*********************
Interfolio also made it easy to submit a generic letter (one that would go with any application), and I didn't see an easy way to submit an application-specific letter.

********************
While many schools with their own websites seem to use common software,  I had trouble convincing the unique HBS site that I was a human being, since I failed to write the correct captcha the first time I tried. In between attempts I had to upload my letter again, i.e. it deleted the letter I had uploaded before failing to prove I was human.

***************
Columbia University's online Recruitment of Academic Personnel System (RAPS) site is annoying, since you  get requests for each position that a candidate applies for, and each requires (the same) letter, but after you have uploaded the letter for one position you have to close your browser before it will let you upload the letter for the next.
**********

NYU Stern's Faculty Management System site asks you to use Internet Explorer or Mozilla Firefox (but even when I do it often doesn't recognize the .pdf files I try to upload, and gives me an error message telling me to upload a pdf...) I've mostly had to email in the letters to Stern...

*************************
Update: some further guidance for the perplexed from EJM:

Hi Professor Roth,

You can upload letters for a candidate to only be delivered to a particular institution the candidate has applied to by clicking on the "show applications" button for a candidate. A list of all their currently active applications will appear as well as options to submit individual letters for each of them.

A more detailed description of how to do this (with pictures) can be found here: http://www.econjobmarketblog.blogspot.com/2013/11/how-to-guide-recommenders.html

EC14, now called Economics and Computation, at Stanford June 8-12 (submission deadline is Feb 11)

Here's the announcement and call for papers. The deadline is Feb 11 for paper submission.

Two related conferences will be coordinated at Stanford at the same time, the NBER market design conference, and the NSF Decentralization conference (see the announcement here).

You can also see how closely interwoven computer science and economics/market design have become by looking at the program committee, which includes both computer scientists and economists mixed up (or maybe mixed up computer scientists and economists):

General Chair: 
Moshe Babaioff, Microsoft Research
ec14-general-chair@acm.org

Program Chairs:
Vincent Conitzer, Duke University
ec14-pc-chairs@acm.org

David Easley, Cornell University
ec14-pc-chairs@acm.org

Workshop Chair:
Robert Kleinberg, Cornell University
ec14-workshops-chair@acm.org

Tutorial Chair:
Shuchi Chawla, University of Wisconsin - Madison
ec14-tutorial-chair@acm.org

Senior Program Committee (one per area):

Theory and Foundations SPC:

Larry Blume, Cornell University
Aaron Bodoh-Creed, UC Berkeley
Felix Brandt, TU Munich
Shuchi Chawla, University of Wisconsin - Madison
Edith Elkind, Oxford University
Joan Feigenbaum, Yale University
Michal Feldman, Hebrew University of Jerusalem
Drew Fudenberg, Harvard University
Nicole Immorlica, Northwestern University and Microsoft Research
Anna Karlin, University of Washington
David Kempe, University of Southern California
Scott Kominers, Harvard University
Ron Lavi, Technion - Israel Institute of Technology
Vahab Mirrokni, Google Research
Utku Unver, Boston College

Artificial Intelligence and Applied Game Theory SPC:

Itai Ashlagi, Massachusetts Institute of Technology
Yiling Chen, Harvard University
Arpita Ghosh, Cornell University
Kate Larson, University of Waterloo
Kevin Leyton-Brown, , University of British Columbia
David Pennock, Microsoft Research
Ariel Procaccia, Carnegie Mellon University
Tuomas Sandholm, Carnegie Mellon University

Experimental, Empirical, and Application SPC:

Eric Budish, University of Chicago
Yan Chen, University of Michigan
Ben Edelman, Harvard University
Ashish Goel, Stanford University
Muthu Muthukrishnan, Rutgers
Denis Nekipelov, UC Berkeley
Sid Suri, Microsoft Research
Steven Tadelis, UC Berkeley

Local Arrangements:
Yoav Shoham, Stanford University

Dmitry Taubinsky (job market candidate), on attention

Among the economists I'm engaged with on the job market this year is Dmitry Taubinsky. He studies attention as a scarce resource, so you shouldn't forget to think about hiring him.  His job market paper is

From Intentions to Actions: A Model and Experimental Evidence of Inattentive Choice

Abstract:  A growing body of evidence suggests that people's inattention may be a signi ficant friction in domains of behavior ranging from medical compliance, to financial decisions, to residential energy use. In this paper, I present a psychologically grounded model of inattentive choice and investigate its implications for dynamic decisions. The model explains seemingly puzzling patterns of consumer behavior, makes novel predictions that I con rm in two experiments, and generates a rich set of market implications. Applied to repeated actions, the model provides an attention-based foundation for the formation of "good" habits in domains such as exercise or energy use. The model explains the recent evidence on the intertemporal spillover effects of temporary incentives, and makes testable predictions about when attention-focusing cues, such as reminders, will dampen or amplify the effects of incentives. Consistent with these predictions, the first experiment reported in this paper shows that while temporary interruptions to daily routines decrease subsequent performance of the behavior, reminders have the largest impact after an interruption. Applied to tasks that must be completed by a deadline, the model identifies when longer deadlines will make people less likely to complete a task. But additionally, the model leads to new comparative statics, tested in the second experiment reported in this paper, about how reminders can eliminate the potentially perverse effect of longer deadlines. Finally, I apply the model to study market interactions between sophisticated firms and inattentive consumers: the model predicts how firms will take advantage of consumer's inattention through sales strategies such as rebates, and also leads to a dynamic theory of how firms use reminder advertisements to steer the behavior of inattentive consumers.

Dan Fragiadakis (job market candidate)

Among the economists I'm engaged with on the job market this year is Dan Fragiadakis. You should think about hiring him.  His job market paper is


Improving Welfare in Assignment Problems: an Experimental Investigation (pdf) (with Peter Troyan). 
Abstract:
"Many institutions face the task of allocating objects (such as university dormitories) to individuals (students) without the use of monetary transfers.  A common solution to this problem is the Random Serial Dictatorship (RSD): agents are ordered randomly, and one at a time, each is assigned her favorite good according to her submitted preferences.  While RSD provides each agent with a dominant strategy of ranking objects truthfully, it may produce socially undesirable outcomes whereby it is possible to make some agents substantially better off at only a small cost to others.  In this paper, we study the prospect of raising welfare in assignment problems by incentivizing agents to report goods they value similarly as indifferent.  Specifically, we modify RSD by ordering agents earlier who report more indifference, a method similar to that used by the Stanford Graduate School of Business to assign MBA students to educational trips abroad.  While theory predicts weak welfare gains in equilibrium, this requires agents to calculate nontrivial best response strategies that deviate from simple truth-telling. In practice, it is unknown whether agents will be able to find these equilibria and, if they cannot, what the welfare implications of using such mechanisms will be. Motivated by these observations, we run a lab experiment where we find  that many agents follow natural heuristics that entail reporting indifferences between objects that are similar in value. Average earnings increase significantly compared to RSD, but the way in which indifference is rewarded can alter the variance in earnings.  This suggests that institutions that use RSD can benefit by rewarding indifference, but should choose how to do so carefully."

I wrote about another of Dan's papers with Pete Troyan yesterday, which is Pete's job market paper.

Pete Troyan (job market candidate) on the rural hospital problem (among other things)

Among the economists I'm engaged with on the job market this year is Pete Troyan. You should think about hiring him.  His job market paper is

Market Design under Distributional Constraints: Diversity in School Choice and Other Applications (with Daniel Fragiadakis)

Abstract:

"Distributional constraints are important in many market design settings. Prominent examples include the minimum manning requirements at each branch in military cadet matching and diversity in school choice, whereby school districts impose constraints on the demographic distribution of students at each school. Standard assignment mechanisms implemented in practice are unable to accommodate all of these constraints. This leads policymakers to resort to ad-hoc solutions that eliminate blocks of seats ex-ante (before agents submit their preferences) to ensure that all constraints are satisfied ex-post. 

We show that these solutions ignore important information contained in the submitted preferences, resulting in avoidable inefficiency. We introduce a new class of dynamic quotas mechanisms that allow the institutional quotas to dynamically adjust to the submitted preferences of the agents. We show how a wide class of mechanisms commonly used in the field can be adapted to our dynamic quotas framework. Focusing in particular on a new dynamic quotas deferred acceptance (DQDA) mechanism, we show that DQDA Pareto dominates current solutions. While it may seem that allowing the quotas to depend on the submitted preferences would compromise the strategyproofness of deferred acceptance, we show that this is not the case: as long as the order in which the quotas are adjusted is determined exogenously to the preferences, DQDA remains strategyproof. Thus, policymakers can be confident that efficiency will be improved without introducing perverse incentives. Simulations with school choice data are used to quantify the potential efficiency gains."

I'll get a chance to blog about another of his papers when I post on Dan Fragiadakis, as they have another joint paper (an experiment) that is Dan's job market paper.

Three students on the economics job market this year (2013-14): Fragiadakis, Taubinsky, Troyan

One sign that I'm in still in transit between retiring from Harvard and settling in at Stanford is that I'm not the chair of the dissertation committee of anyone on the econ job market this year. I am on the dissertation committee of three candidates however, two graduating from Stanford this year and one from Harvard.

They are Dan Fragiadakis and Pete Troyan from Stanford, and Dmitry Taubinsky from Harvard.

Dan is primarily an experimenter and Pete primarily a theorist, and they are both market designers who have collaborated with one another.

Dmitry is a behavioral economist who does both theory and experiments.

I hope to post a bit more about each of them in the coming days, and I'll link to those posts below when I do.
**************************
Updates:

Thursday, December 5, 2013

Pete Troyan (job market candidate) on the rural hospital problem (among other things)

Friday, December 6, 2013

Dan Fragiadakis (job market candidate)

Saturday, December 7, 2013

Dmitry Taubinsky (job market candidate), on attention

Comment on the proposed federal regulation limiting bone marrow compensation

I've written earlier about the proposed regulations that would reverse the effect of the 9th circuit court of appeals decision to allow some bone marrow donors to be compensated. The opportunity to comment on the proposed regulation closed Monday at midnight Eastern time. (Here are all the comments.) Below is a comment on the proposed regulations, signed by a number of economists, myself included. Note point 2 in particular, which points out that the regulation would cut off research on the effect of incentives.

December 2, 2013

Shelley Grant, MHSA, Branch Chief,
Blood Stem Cell Transplantation Program, Division of Transplantation Healthcare Systems Bureau,  Health Resources and Services Administration 5600 Fishers Lane, Room 12C–06, Rockville, Maryland 20857


Comment on Change to the Definition of ‘‘Human Organ’’ Under Section 301 of the National Organ Transplant Act of 1984. Health Resources and Services Administration, HHS. RIN 0906–AB02.

We are academic economists who study how incentives and other mechanisms affect individual behavior and whose research is concerned with improving public welfare. We are writing in opposition to the proposed rule changes by the Department of Health and Human Services (HHS) that would ban compensation for bone marrow donations. The reasons we oppose the proposed rule change are that it ignores the most critical benefits of offering economic incentives (point 1 below) and prevents the ability to properly assess and improve the benefits of offering incentives (points 2 and 3 below) despite the HHS proposed regulation explicitly stating (Section III. Impact Analysis) “Economic and Regulatory Impact Executive Order 12866 directs agencies to assess all costs and benefits of available regulatory alternatives” (Italics added). The HHS document also states that “The provisions of this rule will not affect the following elements of family well-being: Family safety, … parental rights in the education, nurture, and supervision of their children,” and this regulation could prevent parents such as the lead plaintiff in Flynn v. Holder from obtaining bone marrow transplants for their children.1

1. The proposed regulation entirely ignores potential benefits to bone marrow recipients. The motivation for the ban focuses entirely on concerns for potential donors and gives no weight to the consideration of the patients in need of a bone marrow transplant. There are many patients whose health conditions worsen each year waiting unsuccessfully for a matched bone marrow donation. Depending on the patient's race, there is between an 8 and 50 percent chance that there will be no match in the existing registry. As a result, hundreds of patients die each year due to an
inadequate supply of donors.2 Economic incentives have the potential to motivate more bone marrow donations thereby saving and prolonging the lives of potentially thousands of patients. Indeed, the benefit-cost of adding one potential donor to the registry indicates enormous positive value, between 5 and 7 times the benefit to the cost.3 By entirely ignoring these potential benefits, the proposed regulation fails to accurately present the welfare consequences of the ban.

2. The proposed ban will prevent the most policy relevant academic research that is critically needed to determine whether and how economic incentives can be used to save lives. Alternative research methods that do not directly examine actual incentives for actual bone marrow donations (e.g., surveys), or uncontrolled studies that do not appropriately account for confounding factors (i.e., differences in incentivized and non-incentivized populations), will produce unreliable policy evidence. Recent work, consisting mainly of Randomized Controlled Studies (RCTs) examining economic incentives to motivate blood donations, shows positive results when evaluating actual incentives for actual blood donations in natural contexts. This robust evidence contrasts with earlier results using alternative methods not examining actual incentives and donations.4 This is not just an academic point; empirical evidence obtained with rigorous methods should be used to inform policy. This rigor should apply in general, but it is especially critical in the context of bone marrow donations where thousands of lives are at stake every year and where adopting a ban without appropriate evidence could have disastrous  consequences.

3. The ban will eliminate the opportunity to offer any form of economic incentive, not just cash payments. The policy would thus prevent even non-cash rewards that have been shown to significantly increase blood donations with no harm to the quality of the blood supply.5 The proposed change will thus prevent many potential types and sizes of incentives that could be effective. Appropriately designed research could shed light on whether different types of incentives and incentive amounts would have different effects on donations, but the proposed regulation would make this type of research illegal.

In addition to inappropriately assessing the cost-benefit analyses, we oppose the ban for the
following two reasons. First, allowing for the compensation of bone marrow donors does not mean
that donors have to accept the compensation. When offered, donors could still choose to not accept the incentive or could even donate it to charity. Second, donating bone marrow through the
apheresis process and donating whole blood or plasma share a critical characteristic: donors
provide renewable material that is extracted with minimal risk and that their body regenerates
quickly. The US government has never prevented compensation for these other blood products despite deliberations,6 thus from this renewable material perspective there is no reason to have different policies for these types of donations.

In summary, the proposed regulation ignores the potential beneficial effects that offering compensation to bone marrow donations will have on the well-being of patients who need a transplant but are unable to find a match in an uncompensated-only donation system. This implies that “all costs and benefits of available regulatory alternatives” have not been assessed. Moreover, it makes it illegal to conduct the very research that would be critically necessary to establish the effects that incentives can have on donations. For these reasons, we oppose this regulation proposed by HHS that would ban all forms of compensating bone marrow donors.

Signed,
Theodore Bergstrom, University of California at S. Barbara Stefano DellaVigna, University of
California at Berkeley Julio J. Elias, Universidad del CEMA, Argentina
Rodney Garratt, University of California at S. Barbara
Michael Gibbs, University of Chicago Judd Kessler, University of Pennsylvania Nicola Lacetera,
University of Toronto Stephen Leider, University of Michigan John List, University of Chicago
Mario Macis, Johns Hopkins University
Daniel McFadden, University of California at Berkeley Matthew Rabin, University of California at
Berkeley Alvin Roth, Stanford University
Damien Sheehan-Connor, Wesleyan University
Robert Slonim, University of Sydney
Alex Tabarrok, George Mason University



Footnotes:
1 The lead plaintiff, Doreen Flynn, has three daughters afflicted with Fanconi anemia who may need
multiple bone marrow transplants during their teen years.
2 Bergstrom, Garratt, and Sheehan-Connor 2009, Tables 2 and 4.
3 Ibid, Table 7.
4 Lacetera, Macis and Slonim 2013.
5 Ibid.
6 Starr, 1998.


References
Bergstrom, T., Garratt, R., Sheehan-Connor, D. 2009. One chance in a million: altruism and the bone marrow registry. American Economic Review 99, 1309–1334.
Lacetera, N., Macis, M., Slonim, R. 2013. Economic rewards to motivate blood donations. Science 340: 6135, 927–928.
Starr, D. 1998. Blood: An epic history of medicine and commerce. Imperial College, London.

First heart transplant: Dec. 3 1967

Here's the story: First heart transplant: Dec. 3 1967

"Shortly after midnight, Dr. Christiaan Barnard, heading a team of 20 doctors, removes the heart from the body of a young woman named Denise Darvall--who had been hit by a car--and places it into a 53-year-old grocer, Louis Washkansky, who was dying of heart disease.

Barnard would later say that he wasn't sure the surgery was successful until five hours later, when he electrically shocked the transplanted heart and it started beating. Washkansky was soon able to speak and even walk a bit, but died only 18 days after the operation when he developed double pneumonia--a consequence of having his immune system suppressed so that his body wouldn't reject the new organ.

A month later, Barnard repeated the procedure on a 58-year-old dentist named Philip Blaiberg, giving him the heart of a young black man, Clive Haupt, who had died of a stroke--a very controversial decision in racially segregated South Africa,  Blaiberg was kept in a sealed suite of hospital rooms for more than two months and was not given steroids--treatment that had weakened Washkansky. He managed to live for 19 months.

Other doctors had performed heart transplants on animals, but none had been willing to do the surgery on humans, in part because of legal issues, particularly in the United States, where district attorneys had threatened to prosecute doctors who took organs from people who were brain dead, but had not yet died.

Barnard's surgery, however, made it more acceptable to use organs from brain-dead patients. He had been able to take advantage of the absence of legal restraints in South Africa; in fact, he had gone ahead with the operation without seeking permission of his hospital's executives. He only told them about it afterwards. "

Compensation for donors: it's not just kidneys

I'll be speaking later this year about deceased donation at a conference of the International Society for Heart & Lung Transplantation. When I went to their website to arrange some hotel details, I saw this announcement about the Society's position that "the sale of organs from both live and deceased donors is unethical and violates the Universal Declaration of Human Rights."

NEW: ISHLT Position on the Trafficking of Donor Organs
"Tales from the Organ Trade” and similar documentaries are reminders that organ trafficking remains an important international problem. In line with the previously stated ISHLT position and in concert with other national and international transplantation societies, the ISHLT strongly and emphatically endorses the Declaration of Istanbul which seeks to abolish the illegal and immoral trade in donor organs which is supported in part by so called “transplant tourism”. As a corollary of which,  the Society values and supports every effort to improve the availability of donor organs by legitimate process thereby providing community access to these life sustaining therapies.


They link to their 2007 position statement, reproduced here:

International Society for Heart and Lung Transplantation
Statement on Transplant Ethics
Approved April 2007

Thoracic organ transplantation improves the length and quality of life of patients with severe
heart or lung disease. It is a societal endeavour bound by ethical principles. The donation of
organs from a deceased patient must always be made freely and without coercion. The gift
of an organ by a live donor, such as a pulmonary lobe transplant, must be made in the same
fashion and with informed consent. To ensure that these principles are adhered to, the
transplant process must be transparent, legally regulated and open to both national and
international scrutiny.

The ISHLT endorses the view of the World Medical Association that the sale of organs from
both live and deceased donors is unethical and violates the Universal Declaration of Human
Rights.

Obtaining organs for transplantation from the bodies of executed prisoners contravenes the
principle of voluntary donation. A condemned prisoner and his relatives cannot consent
freely. Furthermore, such practices provide a perverse incentive to increase the number of
executions and it lays the judicial process open to corruption.

ISHLT members should discourage patients from seeking transplantation in countries where
transplantation is not open to external scrutiny and the ethical standards of the ISHLT
cannot be assured, regardless of whether payment for organs is involved. ISHLT members
should work with their own governments to ensure that such ‘transplant tourism’ that
contravenes these ethical principles is made illegal.

Members of the ISHLT should not participate in or support the transplantation of organs
from prisoners or the sale of organs for transplantation. Any ISHLT member who has been
found to have contravened this ethical principle may have their rights and privileges as a
member suspended or removed by the ISHLT Board.

Individuals submitting data about clinical transplantation, or the use of human tissue, for
presentation at any of the ISHLT’s meetings, to the Society’s Registry or for publication in
the Journal of Heart and Lung Transplantation will be asked to sign a personal statement
confirming that the principles of both the Declaration of Helsinki formulated by the World
Medical Association and of this ethical statement by the ISHLT have been adhered to.

References
Rothman DJ, Rose E, Awaya T, Cohen B, Daar A, Dzemeshkevich SL, Lee CJ, Munro R,
Reyes H, Rothman SM, Schoen KF, Scheper-Hughes N, Shapira Z, Smit H. The Bellagio Task
Force report on transplantation, bodily integrity, and the International Traffic in Organs.
Transplant Proceedings 1997; 29: 2739-45. Also available at the International Committee of
the Red Cross web-site:
http://www.icrc.org/Web/Eng/siteeng0.nsf/iwpList302/87DC95FCA3C3D63EC1256B66005B3
F6C (accessed 1st May 2007)
Declaration of Helsinki. http://www.wma.net/e/policy/pdf/17c.pdf (accessed 1st May 2007)

Horse meat served in an Israeli restaurant, with subsequent apologies

Here's the story from Haaretz: Psst! That's horse you're eating, Tel Aviv waiter admits
Turkiz serves horse regularly but didn't mention it in the dish description; waiter tells the couple what the menu didn't.

apparently the restaurant has horse meat on its menu, but left it out of the description of at least one dish.

(Many Israelis may share the American repugnance for eating horse, but an additional complication there is that horses don't have split hooves nor chew their cud and so are not kosher.  Apparently the sale of horse meat for human consumption is legal there, unlike here in California...)

HT: Ran Shorrer

An investigative journalist at the Telegraph is offered a kidney for sale

Britons being sold illegal kidneys for surgery in Sri Lanka
Patients awaiting kidney transplants in the UK are being offered illegal organs which are then used in operations at a Ski Lankan hospital

George Dantzig's math library is available for "private treaty sale"

Here is the sale site, and here is Michael Trick's blog post on the sale, Own a Ton of Operations Research History.

That post ends with this observation: " I suspect in the future, there will be far fewer libraries from great researchers.  I know that my own “library” is really nothing more than the hard drive on whatever computer I am using."

High pay isn't repugnant in Switzerland after all, at least not to 65%

Here's the story from Bloomberg: Swiss Voters Reject Strict CEO Pay Limits in Referendum

"Swiss voters rejected a proposal to limit executives’ pay to 12 times that of junior employees yesterday, a measure that would have gone further than any other developed nation.
The measure was opposed by 65 percent of voters, the government in Bern said yesterday.
...
"“It’s a big relief,” Valentin Vogt, president of the Swiss Employers’ Association, said in an interview on Swiss national television SRF. “It’s a signal that it’s not up to the state to have a say in pay.”
Switzerland is the home to at least five of Europe’s 20 best-paid chief executive officers. Opposition to excessive pay has stiffened among the traditionally pro-business Swiss following the government bailout of UBS AG (UBSN), Switzerland’s biggest bank, in 2008 and a plan -- later scrapped -- by Novartis AG (NOVN) to pay outgoing Chairman Daniel Vasella as much as $78 million.
In March, Swiss voters approved the so-called fat-cat initiative that gave company shareholders a binding vote on managers’ pay and blocked golden handshakes and severance packages."
*******************

But sometimes high pay strikes some people as repugnant, and it's not just hedge fund managers: take a look at this story from the NY Daily News.

Top 16 NYC charter school executives earn more than Chancellor Dennis Walcott