Gaming the Liver Transplant Market (by Jason Snyder)

When my colleagues and I began talking to transplant surgeons about the design of kidney exchanges, it was initially sometimes hard to convince them that incentives played a big role in organ allocation. (I sometimes heard a variation of "Professor, incentives may be important in economics, but not in medicine; no one chooses to become sick.") But explanations were made easier by a 2003 legal settlement in which some hospitals paid fines for pretending their patients were sicker than they were, to give them increased priority on the waiting list for deceased donor liver transplants: Illinois: Prosecutor's Diagnosis Is Fraud.

By the time of the settlement, the rules for determining priority on the waiting list for livers had already been changed to depend on more objectively verifiable criteria, to reduce the ability of hospitals to game the system on behalf of their patients. A recent paper by Jason Snyder of the UCLA Anderson School of Management looks at the effect of this change:

"Gaming the Liver Transplant Market" Forthcoming at The Journal of Law, Economics, & Organization
"Approximately 6,000 transplants are performed annually and, on average, 2,500 people die while waiting for a liver. There is substantial variation in the number of transplant centers across markets; some markets have only one firm while other markets have multiple participants. Prior to March 1, 2002, a major determinant of whether a patient would obtain a liver was whether they were in the intensive care unit (ICU). Patients in the ICU jumped to the top of the priority list regardless of how sick they actually were. There is considerable anecdotal evidence suggesting that in order to obtain livers for their patients the transplant centers created faux-ICUs where relatively healthy people were put in the ICU to strategically advance their positions on the waiting list. After March 1, 2002, the allocation of livers changed to a system where livers were allocated solely on clinical indicators of sickness. ICU status was no longer a factor in determining whether a patient obtained a liver or not. This policy resulted in, if anything, an increase in the sickness of the average patient at transplant and a dramatic discontinuous decrease in the number of patients who were in the ICU at the time of their transplant. This seemingly contradictory behavior is consistent with centers strategically misrepresenting the health of their patients prior to the policy reforms.

"Using the policy change to examine changes in ICU admission behavior, I find that after the policy changed the use of the ICU decreased more in markets with more firms. I also find that after the policy changed the percentage of relatively healthy people in the ICU decreased more in markets with more firms. Finally I show that these results are non-linear in the number of firms in the market. Moving from one firm to two firms in the marketplace is associated with dramatic changes gaming behavior, but there is little difference between two firms and three or more firms."

Louis Menand on the market for PhDs in English

Louis Menand, in Harvard Magazine, has many interesting things to say about the Ph.D. in English literature and the market for Ph.D.s in English and the humanities. The Ph.D. Problem: On the professionalization of faculty life, doctoral training, and the academy’s self-renewal

"English was one of the fields surveyed in the two studies of the Ph.D. It is useful to look at, in part because it is a large field where employment practices have a significance that goes beyond courses for English majors. What the surveys suggest is that if doctoral education in English were a cartoon character, then about 30 years ago, it zoomed straight off a cliff, went into a terrifying fall, grabbed a branch on the way down, and has been clinging to that branch ever since. Things went south very quickly, not gradually, and then they stabilized. Statistically, the state of the discipline has been fairly steady for about 25 years, and the result of this is a kind of normalization of what in any other context would seem to be a plainly inefficient and intolerable process. The profession has just gotten used to a serious imbalance between supply and demand."

"The Berkeley study, “Ph.D.s—Ten Years Later,” was based on lengthy questionnaires sent to just under 6,000 people, in six fields, who received Ph.D.s between 1982 and 1985. One of those fields was English. People who received their Ph.D.s in English between 1982 and 1985 had a median time to degree of 10 years. A third of them took more than 11 years to finish, and the median age at the time of completion was 35. By 1995, 53 percent of those with Ph.D.s that had been awarded from 10 to 15 years earlier had tenure; another 5 percent were in tenure-track positions. This means that about two-fifths of English Ph.D.s were effectively out of the profession as it is usually understood. (Some of these people were non-tenure-track faculty, and some were educational administrators. Most of the rest worked in what is called BGN—business, government, and NGOs.) Of those who had tenure, less than a fifth had positions in the kind of research universities in which they had been trained—that is, about 5 percent of all English Ph.D.s. "
...
"The placement rate for Ph.D.s has fluctuated. Between 1989 and 1996, the number of starting positions advertised in history dropped 11 percent; in art and art history, 26 percent; in foreign languages, 35 percent; and in political science, 37 percent. Yet every year during that period, universities gave out more Ph.D.s than they had the year before. It was plain that the supply curve had completely lost touch with the demand curve in American academic life. That meant if not quite a lost generation of scholars, a lost cohort. This was a period that coincided with attacks on the university for “political correctness,” and it is not a coincidence that many of the most prominent critics of academia were themselves graduate-school dropouts: Dinesh D’Souza, Roger Kimball, Richard Bernstein, David Lehman. Apart from their specific criticisms and their politics, they articulated a mood of disenchantment with the university as a congenial place to work.
There were efforts after 1996 to cut down the size of doctoral programs, with apparently some positive effect on the job market. But time-to-degree numbers did not improve. In the sixties, the time-to-degree as a registered student was about 4.5 years in the natural sciences and about six years in the humanities. The current median time to degree in the humanities is nine years. That does not include what is called stop-time, which is when students take a leave or drop out for a semester or longer. And it obviously does not take into account students who never finish. It is not nine years from the receipt of the bachelor’s degree, either; it is nine years as a registered student in a graduate program. The median total time it takes to achieve a degree in the humanities including stop-time is 11.3 years. In the social sciences, it is 10 years, or 7.8 as a registered student. In the natural sciences, time-to-degree as a registered student is just under seven years. If we put all these numbers together, we get the following composite: only about half of the people who enter doctoral programs in English finish them, and only about half of those who finish end up as tenured faculty, the majority of them at institutions that are not research universities. An estimate of the total elapsed time from college graduation to tenure would be somewhere between 15 and 20 years. It is a lengthy apprenticeship."

"... The system works well from the institutional point of view not when it is producing Ph.D.s, but when it is producing ABDs. It is mainly ABDs who run sections for lecture courses and often offer courses of their own. The longer students remain in graduate school, the more people are available to staff undergraduate classes. Of course, overproduction of Ph.D.s also creates a buyer’s advantage in the market for academic labor. These circumstances explain the graduate-student union movement that has been going on in higher education since the mid 1990s. "

"The key to reform of almost any kind in higher education lies not in the way that knowledge is produced. It lies in the way that the producers of knowledge are produced. Despite transformational changes in the scale, missions, and constituencies of American higher education, professional reproduction remains almost exactly as it was a hundred years ago. Doctoral education is the horse that the university is riding to the mall. People are taught—more accurately, people are socialized, since the process selects for other attributes in addition to scholarly ability—to become expert in a field of specialized study; and then, at the end of a long, expensive, and highly single-minded process of credentialization, they are asked to perform tasks for which they have had no training whatsoever: to teach their fields to non-specialists, to connect what they teach to issues that students are likely to confront in the world outside the university, to be interdisciplinary, to write for a general audience, to justify their work to people outside their discipline and outside the academy. If we want professors to be better at these things, then we ought to train them differently."

Humanities job market: priming the pump

The American Council of Learned Societies has decided to give the job market for humanities Ph.D.s a boost, in the face of the tough job market expected this year. It looks like their stimulus package is well designed:


"The American Council of Learned Societies announces a new initiative to address the serious employment challenges faced by many of today’s new Ph.D.s while also supporting teaching at universities and colleges. The ACLS New Faculty Fellows program will allow 50 recent Ph.D.s in the humanities and humanistic social sciences to take up two-year positions at universities and colleges, where their particular research and teaching expertise will benefit the receiving institution. Awardees will commit to teaching three semester-length courses each year and receive an annual stipend of $50,000, a $5,000 annual research and travel allowance, health insurance, and a $1,500 one-time moving allowance. The program is supported by a generous grant from The Andrew W. Mellon Foundation.
Applicants for this program must be nominated by the university that awarded their Ph.D. In this first iteration of the program, nominations are limited to the 60 U.S. members of the Association of American Universities, each of which has designated a liaison for the ACLS New Faculty Fellows program. Possible applicants at participating institutions are encouraged to contact their advisor or department or program chair for further information on the program.
Read more: Stimulus for Humanities Job Market "


The link gives the following additional information:
"All 60 U.S. members of the Association of American Universities have been invited to nominate candidates who do not have a tenure-track position and who will have received a Ph.D. between January 2008 and December of 2009 in the humanities or the "humanistic social sciences," defined as including history, anthropology and such areas as political theory, historical sociology and economic history. The AAU members may nominate between 5 and 40 individuals, based on the size of the Ph.D. classes they produce each year in the humanities.
From these nominees, 50 finalists will be selected based on statements about their teaching and research interests.
Then the AAU universities and a few dozen liberal arts colleges (the latter group is still being defined) will be able to offer positions to the finalists, provided that the universities agree to pay one-third of the costs and the colleges one-fourth of the costs. The AAU institutions will not be allowed to offer positions to their own Ph.D.'s. Any finalists who don't get a job offer will get a one-year stipend of $35,000."


HT: Itay Fainmesser who will be at the ASSA meetings in Atlanta

Market for lesson plans

College professors sell textbooks, business school professor can profit from case studies, and now there's a market for lesson plans for elementary and middle school classes: Selling Lessons Online Raises Cash and Questions .

The "cash" in the headline is clear enough, while the "questions" seem to be of two kinds. The first is about intellectual property, who owns what:
"While some of this extra money is going to buy books and classroom supplies in a time of tight budgets, the new teacher-entrepreneurs are also spending it on dinners out, mortgage payments, credit card bills, vacation travel and even home renovation, leading some school officials to raise questions over who owns material developed for public school classrooms."

The other kinds of questions involve the repugnance we sometimes see raised by markets for things that used to be given away or handmade:
"Beyond the unresolved legal questions, there are philosophical ones. Joseph McDonald, a professor at the Steinhardt School of Culture, Education and Human Development at New York University, said the online selling cheapens what teachers do and undermines efforts to build sites where educators freely exchange ideas and lesson plans.
“Teachers swapping ideas with one another, that’s a great thing,” he said. “But somebody asking 75 cents for a word puzzle reduces the power of the learning community and is ultimately destructive to the profession.” "

The internet is a big facilitator here:
"Just about every imaginable lesson for preschool through college is now up for sale — on individual teachers’ blogs as well as commercial sites where buyers can review and grade the material.
Teachers Pay Teachers, one of the largest such sites, with more than 200,000 registered users, has recorded $600,000 in sales since it was started in 2006 — $450,000 of that in the past year, said its founder, Paul Edelman, a former New York City teacher. The top seller, a high school English teacher in California, has made $36,000 in sales.
Another site, We Are Teachers, went online last year with a “knowledge marketplace” that includes lesson plans and online tutoring."

Signaling for interviews in the Economics Job Market: Registration opens tomorrow

Here is the American Economic Association's announcement of the 2009 mechanism for Signaling for Interviews in the Economics Job Market

"The AEA coordinates a mechanism through which applicants can signal their interest in receiving an interview at the January meetings. From November 16, until December 1, shortly after the December JOE comes out, each applicant on the economics job market can register and designate no more than two departments (or other employers) to whom to send a signal of particular interest. On December 3, the AEA will transmit these signals to the departments a candidate has chosen. (Signals will not be made public.)

Please see Signaling for Interviews in the Economics Job Market for a detailed description as well as the Terms of Use and Privacy Policy. "

Those already registered may select or update signals until Midnight, EST on December 1, 2009. This is a firm deadline.

In each of the years when signaling has been available (2006-9), about 1,000 signalers have used the system (almost all choosing to send 2 signals). Around 25% of JOE listings have received at least one signal in each of those years. So signaling has been pretty widespread, with lots of senders and receivers.

So, that said, should you signal? Or perhaps there's some reason not to signal?

In a December 2008 survey of those appearing on departmental lists of job candidates, 66% of respondents reported signaling. Of the remaining 33% of respondents, 26% reported that they missed the deadline, 21% reported they didn’t know about the mechanism, 41% thought signaling wouldn’t help their chances of getting a job, and 5% thought signaling would hurt their chances of getting an interview.

On this last point I can offer some reassurance; in our surveys of department recruiting committees, there is no indication whatsoever that anyone regards a signal as a negative indicator in deciding whether to offer an interview.

There is also some indication that signals help, at least sometimes (again from survey data, since we don't have direct access to data on who gets interviews), particularly for signals sent to employers who don't receive an excessive number of signals. (The 21 employers receiving the most signals received about 1/6 of all signals: ten of these employers are in the Boston, NY, and D.C. metropolitan areas.) Overall, a signal seems to increase the likelihood of an interview by around 6 percentage points.

I think it is sensible for most candidates to send the two signals they are allotted. I think the most you can expect a signal to do is to cause someone at the signaled department to take one more look at your dossier, and consider whether it makes sense to include you on their already pretty full schedule of interviews, given your interest. So, choose your signals with that in mind, and they may work for you.

(I hope to have a paper ready for circulation reasonably soon, with my colleagues on the AEA job market committee...)

Nothing human need be foreign to economics

Economists like to think of Economics as a broad church that welcomes investigation of a wide range of human activity from many viewpoints. Nothing human is foreign to us. Non-economists (and perhaps some economists as well) take a much narrower view of what economists can and should investigate, and how well we can do so.

An inadvertently hilarious juxtaposition of those two views comes in a column in The Guardian: Our speechless outrage demands a new language of the common good--Market theory closed down public discourse about injustice. But we urgently need to describe what we should value

The author opines: "But don't look to economists to get us out of this hollow mould of neoliberal economics and its bastard child, managerialism – the cost-benefit analysis and value-added gibberish that has made most people's working lives a mockery of everything they know to value."

She then goes on to suggest that the evils of economics may be remedied by philosophers, and praises Amartya Sen's new book The Idea of Justice.

The joke of course is that the author of the column is blissfully unaware that Amartya is an eminent economist, and the winner of the 1998 Nobel prize in economics.

Needless to say, justice is an excellent thing for economists to study, and strive to understand and achieve.

A grave problem of supply and demand

Grave sites, once sold and occupied, are intended to be occupied for a very long time, and their sale can't easily be negotiated if more valuable uses turn up. So there is less turnouver than in other kinds of real estate, with predictable consequences, as this Globe article attests: Supply limited, demand eternal, graveyards fill up.


"Provincetown’s shortage, while unusually acute, underscores a broad and burgeoning problem in the crowded Northeast. With land expensive and limited acreage available in large swaths of Eastern Massachusetts, budget-crunched communities are struggling to buy sites for new burial grounds as their existing cemeteries fill up."
...
"In Provincetown, many who have reserved burial plots are relative newcomers to the town, and in response, town officials this week passed a rule restricting burial plots to those who have maintained a principal residence for at least two years. Still, that was a short sojourn, some said, for a chance to spend eternity in a slice of heaven.
Said Lemme, the cemetery supervisor: “We might have to make that a little stricter.’’ "

School choice, and separation of church and state

As a beneficiary of both a democratic and a religious tradition, I think that separation of church and state is good not just for states (if they happen to be liberal democracies), but also for religious communities (if they aspire to be self governing). In Britain, there are state funded religious schools, so school choice issues for religious schools get resolved by secular courts: Who Is a Jew? Court Ruling in Britain Raises Question .

"Britain has nearly 7,000 publicly financed religious schools, representing Judaism as well as the Church of England, Catholicism and Islam, among others. Under a 2006 law, the schools can in busy years give preference to applicants within their own faiths, using criteria laid down by a designated religious authority. "

The case in question is wending its way through the appeals court process. But it appears that, by accepting state funding, Britain's religious communities have let the state into the church, so to speak.

Update:Dec. 15. British High Court Says Jewish School’s Ethnic-Based Admissions Policy Is Illegal
Update: January 10: Faith schools facing admissions curb

Incentives in Chicago school choice

The Chicago Sun Times reports:
"Poring over data about eighth-graders who applied to the city's elite college preps, Chicago Public Schools officials discovered an alarming pattern.
High-scoring kids were being rejected simply because of the order in which they listed their college prep preferences.
"I couldn't believe it,'' schools CEO Ron Huberman said. "It's terrible.''
CPS officials said Wednesday they have decided to let any eighth-grader who applied to a college prep for fall 2010 admission re-rank their preferences to better conform with a new selection system.
Previously, some eighth-graders were listing the most competitive college preps as their top choice, forgoing their chances of getting into other schools that would have accepted them if they had ranked those schools higher, official said.
Under the new policy, Huberman said, a computer will assign applicants to the highest-ranked school they qualify for on their list.
"It's the fairest way to do it," Huberman told the Chicago Sun-Times editorial board Wednesday."

This is the same issue that led to the redesign of the Boston school choice system.

HT Parag Pathak

update: see earlier stories on the changes in the Chicago magnet school program here and here.

Morality of buying kidneys (and brokering them)

Robby Berman, the founder and director of the Halachic Organ Donor Society (www.hods.org ), has an opinion piece in today's YNet: Buying kidneys is moral

It begins:
"I am responsible for the needless deaths of more than 100 Jews. All were victims of kidney disease, literally and figuratively dying on dialysis. They pleaded with me to introduce them to people willing to sell their kidneys, and I refused to do so because it is illegal.
If media reports are true, however, Sammy Shem-Tov and Dimitry Orenstein of Jerusalem did work as a kidney shadchanim (matchmakers) - saving hundreds of lives. Their motives weren’t pure. It took lots of money to get them to break the law and risk prison. So who acted morally and who did not? To me the answer is obvious. They are heroes even if they became wealthy in the process. "

It goes on to make some arguments related to repugnance.

School choice and school capacity

Deciding what is the capacity of a popular high school is tricky in a city that uses school choice. Here's an article from the NY Times about Francis Lewis high school in Queens, in NYC. It is way over 'capacity' because it is popular: At School in Queens, Success Draws Crowd.

(To put it another way, capacity is flexible, and so are students; some eat lunch at 9am, since the lunchroom has to be scheduled all day...)


Following the publication of the story, the Times published some letters to the editor from proud former teachers and students at Francis Lewis (including one from a famous economist).

More Milgrom

Northwestern has put up a page of material following the 2009 Erwin Plein Nemmers Prize in Economics Lecture and Conference, including Paul's slides, and a video of his lecture.

There are also links to the slides and bibliographies of the talks given on Friday (including the 10 minute presentations given by panelists; now I'm working on my 1 minute talk...)


Vijay Krishna (Pennsylvania State University): Auctions and Information[Presentation and Bibliography - PDF]

Larry Ausubel (University of Maryland): Auctions with Multiple Objects[Presentation - PDF] [Bibliography - PDF]

Panel Discussion: Market Design.Moderated by Rakesh Vohra (Northwestern University)
Susan Athey (Harvard University) [Slides]
Preston McAfee (Yahoo! Inc.) [Slides]
Paul Milgrom (Stanford University) [Slides]
Alvin Roth (Harvard University) [Slides]

Stephen Morris (Princeton University): Trade and Information[Presentation - PDF] [Bibliography - PDF]

Bengt Holmstrom (Massachusetts Institute of Technology): Agency Models[Presentation - PDF] [Bibliography - PDF]

John Roberts (Stanford University): Organizational Economics[Presentation - PDF]

And here is my previously posted unofficial conference photo.

College admissions: the costs of having too many acceptances

The Chronicle of Higher Education has a story on Ithaca College which illustrates some of the difficulties of the college admissions process from the colleges' point of view: Ithaca College Overshoots Its Admissions Mark and Pays a Price. (This link may need a subscription, so here's a longish excerpt that gives the idea...)

"In a year of unusually high uncertainty over admissions at private colleges, Ithaca College appears to have missed its target by a larger margin than most.
Now it is dealing with the financial consequences—even paying 31 students up to $10,000 each to defer their enrollment for a year—and adjusting its admissions policies and financial-aid spending plans in response.
Ithaca had aimed to enroll 1,700 to 1,750 new freshmen but found itself with an incoming class of 2,027 for this fall.
Ending up with a class that is 20 percent larger than expected is certainly better than having to operate with a class that is 20 percent under target. But "coming in heavy" with a class, as this circumstance is known in the field, can often bring its own short-term and long-term costs, and create some added financial instability.
"They have to feed that animal for four years," said George Dehne, a longtime consultant to colleges, whose firm does not count Ithaca as a client. "It looks like someone took their hands off the wheel."
The feeding includes extra spending for financial aid, for additional instructors (Ithaca had to hire several dozen), and for a new temporary residence hall, constructed in six weeks at a cost of $2.5-million."
...
"Ithaca had suffered a decline in freshman enrollment in 2008, falling 11 percent below its budgeted target of 1,600. Many of the steps it took over the past year to enroll the entering class in 2009 were designed to compensate. The steps included lowering selectivity (Ithaca accepted 73 percent of its 2009 applicants, compared with 59 percent in 2008) changing its merit-aid policy so money could be spread among more applicants, and intensifying "yield" efforts to get more admitted students to attend.
Other colleges did the same things, according to a survey released last month by the National Association for College Admissions Counseling.
But Ithaca lacked some of the levers colleges traditionally use to give themselves more control over admissions, most notably the early-decision option.
Many colleges use early decision to lock in a portion of their class early in the admissions cycle, which helps reduce some of the risks inherent in later stages of the process, when institutions decide how many students to admit outright and how many to place on the waiting list."
...
"Mr. Maguire, Ithaca's new enrollment-management chief, ... said the college is reinstating early decision, two years after dropping it. Without it, he said, Ithaca didn't have a solid picture of its admissions situation until very late in the process. Freshman deposits came in with a "huge spike at the very end of April.""


"The Cost of Too Many Freshmen
Ithaca College made several adjustments in policies and spending after enrolling 20 percent more students than it expected to this fall. These included:
Reinstituting early decision, to give the college more control over admissions earlier in the process.
Raising admissions selectivity for the fall of 2010 to reduce the admit rate.
Erecting a temporary residence hall in six weeks at a cost of $2.5-million.
Allocating up to $1.2-million in additional funds to hire nearly 50 part-time faculty members, two new full-time faculty members, and to pay 30 current full-time professors overload pay for teaching extra courses.
Providing 20-percent reductions on room charges, and paying the cable-TV bills, for students who had to be housed in lounges.
Offering admitted students up to $10,000 each to defer their enrollment for a year (Ithaca says 31 students took the offer, at a total cost of about $250,000).
Providing $2,000 in incentives to upperclassmen to move off campus. "

College admissions in the UK, update

The Times offers British students a Good University Guide, with some advice on navigating the various parts of the British college admissions process, including the scramble known as "clearing," and the difficulties of taking advantage of re-graded exams.

Act fast to snap up a place
Competition to make it to university through clearing will be more intense this year as applicants chase fewer places

Guide to Clearing: essential information on universities in the clearing system
John O’Leary outlines some of the pros and cons of 40 UK universities likely to be offering the most places through clearing this year


A-level system will not help students 'trade up'
Pupils who do better than expected in exams will miss out on places at leading universities because courses are already full.
"Those who are unfairly marked down in A-level exams could lose their place, even if they successfully appeal and later get a higher grade. Some courses are closed to British applicants even though they still have places for foreign students. This is because for financial reasons the Government restricts the number of British students that universities can recruit. Overseas students pay higher fees and do not receive the grants or subsidised loans available to home students. "


There's also a guide to the mysteries of college admissions on this side of the pond: How to get into an American university
Students are increasingly looking across the Atlantic for university – but the application system can seem daunting.

"One of the main differences between the US and here is that there is no central body that handles the admissions, as Ucas does in the UK. "


Here are my earlier posts on British college admissions:

University admissions in the UK, and University admissions in the UK: admissions formulae

Mazel tov to Methodist Hospital in San Antonio

A Methodist milestone: 50th paired donor kidney exchange transplant

"The transplant team at Methodist Specialty and Transplant Hospital performed their first exchange procedure in March 2008 and completed the 50th procedure just 19 months later, with 42 of the exchange transplants performed in just the past 10 months. "

Update: here's a link to the hospital's news release, which makes clear that they are performing all these exchanges primarily among patients in Texas: Methodist Specialty and Transplant Hospital Reaches National Milestone with 50th Paired Kidney Exchange Transplant

Competition among stock exchanges

The NY Times has a story about how New Rivals Pose Threat to New York Stock Exchange.

"While the exchange has been under assault since the beginning of the decade, its decline has accelerated in recent years as aggressive competitors have emerged. Today, 36 percent of daily trades in stocks that are listed on the New York Stock Exchange are actually executed on the exchange, down from about 75 percent nearly four years ago. The rest of are conducted elsewhere, on new electronic exchanges or through dark pools. "

..."Unlike the Big Board, the new electronic exchanges are virtually unknown outside financial circles. Direct Edge, the largest, is in Jersey City. Another, the BATS Exchange, is based in Lenexa, Kan. Both are only about five years old. But each now accounts for about a 10th of daily United States stock trading. "

I'm reminded of Estelle Cantillon's paper with Pai-Ling Yin on a battle between London and Frankfurt exchanges: Competition between Exchange: Lessons from the Battle of the Bund

Market designers at the Milgrom/Nemmers Prize conference

A multitude of market designers. Here's a photo of

Bob Wilson, Paul Milgrom; and Parag Pathak in the near background: Faces to recognize, and names to conjure with.

Here's my pre-conference post: Paul Milgrom: Nemmer's Prize Lecture and Conference

The wholesale market for iPhone Apps

Joshua Gans reports: The Wholesale App Market opens.

Fraud in online auctions

Losing Out After Winning an Online Auction

NY Times article discusses deadbeat sellers and fraudulent escrow services.

More on repugnant language

While the Federal Communication Commission continues to regard the broadcast of some words as repugnant, language scholars continue to trace how taboo terms gradually become more acceptable. (See my earlier post Fleeting expletives and wardrobe malfunctions: FCC vs Fox Television and CBS.)


Oxford University Press has just issued a new edition of The F-Word. Their blurb begins:

"We all know what frak , popularized by television's cult hit Battlestar Galactica , really means. But what about feck ? Or ferkin ? Or foul --as in FUBAR , or "Fouled Up Beyond All Recognition"? In a thoroughly updated edition of The F-Word , Jesse Sheidlower offers a rich, revealing look at the f-bomb and its illimitable uses. Since the fifteenth century, no other word has been adapted, interpreted, euphemized, censored, and shouted with as much ardor or force..."

Peer effects in learning and teaching, but not in golf

The October '09 issue of the American Economic Journal: Applied Economics contains three papers on peer effects.* The first of these begins "Is an employee's productivity influenced by the productivity of his or her nearby co-workers? The answer to this question is important for the optimal organization of labor...and for the optimal design of incentives." It then goes on to say that it detects no such effects from the random groupings of golfers in professional golf tournaments.

The second paper does find peer effects in random groupings of cadets at West Point, and the third paper finds that students do better when their teachers have better colleagues, i.e. they find that the teachers experience peer effects as measured by the performance of their students.

*The three papers are:

"Peer effects in the workplace: Evidence from random groupings in professional golf tournaments," by Jonathan Guryan, Kory Kroft, and Matthew J. Notowidigdo.

"The Effects of Peer Group Heterogeneity on the Production of Human Capital at West Point," by David S. Lyle.

"Teaching Students and Teaching Each Other: The Importance of Peer Learning for Teachers," by C. Kirabo Jackson and Elias Bruegmann.

Paul Milgrom: Nemmer's Prize Lecture and Conference

If the creeks don't rise, I'll be at Northwestern this afternoon, listening to Paul speak about "The Promise and Problems of Market Design"

His talk will be followed by a conference in his honor tomorrow.

Here's the abstract of Paul's talk:
"Market design has become an exciting area of economics research, with many of its findings useful for setting detailed rules in real markets. For matching markets, most proposed designs aim to be "straightforward" - making it a dominant strategy for participants to report information truthfully. But some recent matching and auction designs sacrifice incentive-compatibility conditions to give priority to various other desiderata. This lecture reviews the goals of market design and the unavoidable trade-offs that are sometimes required, and explores how economists should seek to resolve these trade-offs. "

Here's the conference lineup:

Vijay Krishna (Pennsylvania State University): Auctions and Information
Larry Ausubel (University of Maryland): Auctions with Multiple Objects
Panel Discussion: Market Design.Moderated by Rakesh Vohra (Northwestern University): Susan Athey (Harvard University), Preston McAfee (California Institute of Technology), Alvin Roth (Harvard University), Paul Milgrom (Stanford University)
Stephen Morris (Princeton University): Trade and Information
Bengt Holmstrom (Massachusetts Institute of Technology): Incentives
John Roberts (Stanford University): Organizational Design

Voters find same sex marriage repugnant in Maine

Maine voters overturn state’s new same-sex marriage law.
"Maine voters overturned the state’s same-sex marriage law yesterday, delivering a potentially crushing blow to gay-rights advocates after a year when their cause seemed to be gaining momentum with legislative and legal victories in four states."...
"The “people’s veto’’ came six months after Maine’s law was approved, and one year after California voters rejected gay marriage by a similar margin."

So same sex marriage has been moved out of the repugnant category in several states by courts, and by legislatures, but not yet by voters. As the AP report notes (ungrammatically),
"Gay marriage measures have lost in every state, 31 in all, in which it has been put to a popular vote. "

The DARPA network challenge

DARPA will pay $40,000 to whoever (whichever team) first reports the locations of ten weather balloons to be inflated December 5, around the U.S. Here is the announcement: DARPA Network Challenge.

Noam Nisan has some thoughts on this at AGT, and points out that very quickly some people started to offer to share the prize among those who would notify them of individual balloon's locations, conditional on the team formed in this way winning. Here's a wiki for people to share market design ideas on how to form a winning team.

Note that this is an aggregation of information problem a little like a prediction market, even though it is for postdiction rather than prediction...

Build your own prediction market

Build your own, using the platform at http://inklingmarkets.com/

Blackmail, legal and illegal

Reflecting on the recent Letterman case, the NY Times ponders The Art of Blackmail


Doing it on your own is illegal, but if you do much the same thing by threatening a lawsuit, it is legal.


"Blackmail is a “wonderfully curious offense,” to use the phrase of Paul H. Robinson, a professor at the University of Pennsylvania Law School and his coauthors in a recent paper. A threat to tell the truth is no crime, and neither is asking someone for money. But if you demand money to prevent the truth from being told, Professor Robinson said, you’ve crossed the line. At its core, he explained, the offense is “a form of wrongful coercion.” "


However you can threaten to sue if a settlement is not reached first, and that isn't blackmail.

"Those confrontations, however, did not cross the line into the criminal realm, he said, because they had been sanitized by lawyering. Attorneys, he noted, can create a legal filing that promises to bring out unpleasant facts in depositions or during trial; a settlement is not, technically, a payoff. He called it “wrapping an extortion threat in a legal cloak.”
It happens all the time, said Gerald B. Lefcourt, a criminal defense attorney in Manhattan. “Threatened lawsuits, and even filed lawsuits, are often no more than blackmail,” he said.

Compensating donors: how about bone marrow?

The National Law Journal reports: Cancer patients seek to overturn ban on paying for bone marrow

"Prohibiting someone from making money for donating an irreplaceable kidney is one thing. But what about donating bone marrow, which replenishes itself within weeks?

That question is at the heart of a new lawsuit, filed Monday, challenging the constitutionality of the federal law that prohibits compensating bone marrow donors. The plaintiffs want to make modest recompense for such donors legal — say, paying partial tuition for a college student or making a mortgage payment for a first-time home buyer.

In the lawsuit filed Oct. 26 in the U.S. District Court for the Central District of California, cancer and blood disease patients and health care advocates are suing U.S. Attorney General Eric Holder Jr. to enjoin enforcement of provisions of the National Organ Transplant Act of 1984 that criminalize compensating donors. They argue the statute violates due process rights and interferes with public health.

"This constitutional challenge is about an arbitrary law that criminalizes a promising effort to save lives," the complaint states. A bone marrow transplant is often the "only hope" for tens of thousands of Americans diagnosed with a deadly blood disease such as leukemia. "There is a desperate shortage of unrelated marrow donors, particularly for minorities," the complaint says.

Offering modest incentives to attract more donors could end that shortage, argued Jeff Rowes of the Arlington, Va.-based Institute for Justice, who is the lead attorney for the plaintiffs. "

Megan McArdle links to the Institute of Justice press release, and suggests that inclusion of bone marrow in the National Organ Transplant Act was simply a mistake.

A paper on bone marrow donation recently appeared in the American Economic Review, you can find an ungated version here: One Chance in a Million: Altruism and the Bone Marrow Registry
by Ted C. Bergstrom, Rod Garratt, and Damien Sheehan-Connor.

The paper argues that (because of the need for bone marrow matches to be perfect on the 6-vector of Human Leukocyte Antigens, and because of different distributions of these by race and ethnicity), we would get more bang for the buck by investing in recruiting more minority donors than additional random donors.

As it happens, for non-minority donors, the present policy in many places is just the opposite of compensating donors; if you want to register as a bone marrow donor you may have to pay the costs, presently around $65.

HT: Mary O'Keeffe and Steve Leider

Update, 11/4/09: Some comment on the legal theory of the case over at the Volokh Conspiracy, with a second and third post here and here and more to come...

Kidney exchange at the ASSET conference in Turkey

The annual meeting of the Association of Southern European Economic Theorists is meeting in Istanbul this weekend. Among other notable events (such as keynote talks by Andy Postlewaite and Muhamet Yıldız), there is a session today on Kidney Exchange. Below are links to the program (with links to all the papers) and to the kidney exchange papers.

ASSET 2009
Boğaziçi University, Istanbul
October 30-31, 2009
Conference Program


Saturday, October 31
S3.1: Kidney Exchange Room: WH 201Chair: Antonio Nicolò, University of Padua

Dynamic Analysis of Kidney Exchange Problems
Silvia Villa, Università Di Genova

Paired Kidney Donation and Listed Exchange
Özgür Yılmaz, Koç University

Pairwise Kidney Exchange with Age Based Preferences
Antonio Nicolò, University of Padua

HT: Bettina Klaus

Market design in science fiction

Stephen Weinberg, a well read economist at University of Albany (which I still think of as SUNY Albany), sends me the following email:

"I hope you're doing well. I've been greatly enjoying your mechanism design blog.

I'm not sure if you like science fiction, but if so, I thought you'd be amused to know that a recent scifi novel includes a plot point based around mechanism design. The novel is Eye of the Storm by John Ringo.

The basic gist is that, in previous books, the US had to create a humongous army to fight off an alien invasion. It then dropped down to only nominal force levels for a few decades (during which the ex-soldiers didn't age because of "rejuv" technology). Now they need to quickly create a new army, so to start with they've called up enough soldiers for a couple of divisions. The mechanism design part is that they decide to staff the divisions by letting officers use points to bid on their positions and subordinates. Some of the more talented officers decide to collude to game the system.

I've gone ahead and copied in the relevant chapters, in case you find it amusing. "

If I could have figured out how to create an "after the jump" break on this blogger I would have included the long, interesting excerpts Stephen included, which, among other things, had sniping in a combinatorial auction as a critical strategy.

The "Netflix for academic journals"

For those without comprehensive electronic access to journals through big university libraries, the Chronicle of Higher Ed reports The Netflix of Academic Journals Opens Shop

"By opening the largest online rental service for scientific, technical, and research journals, the company Deep Dyve is hoping to do for academic publications what Netflix has done for movies: make them easily accessible and inexpensive for everyone.
The Web site has been an academic-journal search engine since 2005 and unveiled its rental program this week. Now anyone can “rent” an article—which means you can view it on your computer without ownership rights or printing capabilities—for as little as 99 cents for 24 hours. Users can also subscribe for monthly passes. Currently the site has 30 million articles from various peer-reviewed journals.
William Park, chief executive of Deep Dyve, says the model will not only allow more people to read articles they might otherwise not see, but will actually encourage users to purchase more content from journals. He says that now, only about 0.2 percent of people visiting journal Web sites go on to buy articles, because they don’t know exactly what they are getting from just a title and an abstract.
“Nobody would buy a car without at least evaluating it first,” Mr. Park says. “The same is true for anything, whether it’s a dollar or $10,000.”
Mr. Park says that Deep Dyve has revenue-sharing partnerships with hundreds of publications (about 80 percent of which are scientific) and hopes to expand to more of the humanities within the coming months."

Forced Labor

A new book recently arrived in the mail: Forced Labor, Coercion and Exploitation in the Private Economy, edited by Beate Andrees and Patrick Belser of the UN's International Labour Office. Here is the executive summary.

The terms "debt bondage" and "bonded labor" appear to be terms of art for involuntary servitude in various forms.

The book is mostly about the developing world, although there is a chapter on "Trafficking for Forced Labor in Europe," concerning migrant workers. The book has no chapter on the United States (where newspaper reports about involuntary servitude mostly seem to focus on illegal immigrants caught up in forms of indentured servitude, and sometimes deal with prostitution). I would be glad if that is because the 13th Amendment to the U.S. constitution is largely effective:

"Neither slavery nor involuntary servitude, except as a punishment for crime whereof the party shall have been duly convicted, shall exist within the United States, or any place subject to their jurisdiction."

Hours per week worked by (young) surgeons

In Britain as in the United States, there is considerable debate about the hours worked by physicians and surgeons, and what these mean for patient safety. Convincing data are lacking, but the Royal College of Surgeons of England has just weighed in with a new report, saying that limiting the hours of surgeons endangers patients: Patients are being harmed by working time limits, finds new study


The report argues that frequent handoffs allow patient information to be lost, as doctors have less chance to observe changes in a patient's condition.


"Surgeons across the country say patients are much less safe in the NHS since the August introduction of European Working Time Regulation (EWTR) 48 hour working limits as continuity of care for patient collapses, this is the damning assessment of a survey of NHS surgeons. Services are only being held together by a ‘grey market’ of doctors willing to covertly breaking the legislation to maintain care for patients."

..."The College surveyed 900 surgeons - almost an eighth of the UK surgical workforce – with responses from more than 360 consultants and more than 500 trainees to see how surgical services were faring under the new working time restrictions. It found some alarming results:
...
"A third say handover arrangements are inadequate in their hospital and 23 per cent say they cannot stay involved in all stages of individual patients clinical care that require their expertise."
...
"Patients are being lost and at increased risk of dying as a direct result of so many shift changeovers and rotas which leave no time available to handover. Trainee surgeons across the country are staying on unpaid after the hours limit because they want to see through care for patients. They are also taking on additional paid locum work in the hope of gaining the training opportunities they cannot get in their formal working week. Meanwhile hospitals are relying on this goodwill because they know they couldn’t stay open without them. As a result there is an emerging grey market in hospital cover with doctors true working hours being kept off the books."


On the other side is the argument that sleepy doctors endanger patients. We don't let airline pilots work long hours, why should the doctors who staff emergency rooms and operating rooms be different? In the United States, the 1984 death of Libby Zion led to new legislation in her name to limit the working hours of medical residents: A Life-Changing Case for Doctors in Training

College admissions in Illinois, conclusion?

U. of Illinois at Urbana-Champaign Chancellor Resigns in Wake of Admissions Scandal
Richard Herman, chancellor of the University of Illinois at Urbana-Champaign, has resigned in the wake of an admissions scandal in which well-connected applicants were put on a "clout list" and given preferential treatment, the Chicago Tribune reported on Tuesday. Mr. Herman, who made a remorseful apology to the faculty after a state panel found he was the "ultimate decision maker" for clout-listed applicants, will join the university's faculty. His resignation follows those of the university president last month and several trustees.

Roger Myerson and Paul Romer on designing nations and cities

Two emininent economists have been thinking about design on the largest of scales.

Roger Myerson thinks about nation building in general, and Iraq in particular, and reflects on the role of political leaders' reputations, for patronage among other things.

Paul Romer thinks about macro-market-design in the form of new "charter cities," to be modeled roughly on Hong Kong.

Here is Roger, in "A Field Manual for the Cradle of Civilization:Theory of Leadership and Lessons of Iraq, " Journal of Conflict ResolutionVolume 53 Number 3 June 2009 470-482. (HT Paul Milgrom)

"Agency incentive problems in government make patronage an essential aspect of statebuilding, and political leaders become fundamentally constrained by their reputations. Democratic competition requires many leaders to develop independent reputations for exercising power and patronage responsibly, which can be encouraged by political decentralization."

Roger then recounts Xenophon's description of the rise of Cyrus (Koresh), the Persian leader.

"The key to Cyrus’s success was his apparent love of justice, which was inculcated by his education and which enabled him to earn the trust and loyalty of a great army. But what kind of justice was it that Cyrus loved so much? It was certainly not justice for poor peasants, whose crops were gathered to support his conquering forces.
What Cyrus loved was justice for the soldiers who served his cause. Apparently Cyrus’s greatest pleasure in life was to judge the valor of troops in battle and to reward them richly for their accomplishments, asking nothing for himself. As a mechanic knows the names of his tools, Cyrus learned the names of all the captains in his army, so that each could be confident of his service being remembered. When everybody recognized Cyrus as the best leader to distribute their booty after a victory, he could take power, first over the multinational coalitional forces and, ultimately, over Asia."


Paul Romer, explains the idea of charter cities here, and in a Q&A at Freakonomics, here: Can “Charter Cities” Change the World? A Q&A With Paul Romer

He argues that to credibly move to better rules, you might have to do some things all at once and start fresh. (He suggests a good place to start would be to have a new Cuban city administered by Canada at Guantanamo Bay, to try to recreate the experience of Hong Kong.)

He too isn't afraid to think big:

"Q. It all sounds great as a theoretical exercise, but honestly, don’t your colleagues tell you that something like this will never happen?

A. They do say this, which is actually kind of ironic when you line it up with the other things they say. They recognize that the construct of a charter city is something that could make everyone better off. They admit that there is no technological or economic constraint that keeps us from building many of these. Then they say that for political reasons, it will never happen. They tell me that you can’t change politics; you can’t overcome nationalism; there is no way for countries to work together to extend the reach of good rules. Then these same economists suggest that we should just stick to business as usual. We should offer conventional economic advice and assume that political systems will naturally follow our advice when we point to something that could make everyone better off. But of course, they have already revealed that they don’t believe this. What’s going on here is a kind of self-censoring. Economists seem to think that we should propose things that are acceptable and that political systems will pursue, but that we should avoid proposing or even discussing things that are controversial or politically incorrect. I think we’d do our jobs better if we just said what’s true without trying to be amateur politicians. "

Romer and Myerson seem to have different views of where economics ends and politics begins.

Does a decrease in the number of traffic fatalities increase live kidney donation?

Over at Economic Logic, the Economic Logician reviews an article, The Effect of Traffic Safety Laws and Obesity Rates on Living Organ Donations by Jose Fernandez and Lisa Stohr. It finds that a decrease in availability of deceased donor organs (through an increase in helmet and seatbelt laws) elicits some increase in live donor kidney donation.

Here's the abstract, followed by EL's summary.

Abstract: This paper uses variation in traffic safety laws and obesity rates to identify substitution patterns between living and cadaveric kidney donors. Using panel data from 1988-2008, we find that a 1% decrease in the supply of cadaveric donors per 100,000 increases the supply of living donors per 100,000 by .7%. With respect to traffic safety laws, a national adoption of partial helmet laws is estimated to decrease cadaveric donors by 6%, but leads to a 4.2% increase in the number of living donors, or a net effect of 1.8% decrease in the supply of kidney donations. The recent rise in obesity rates is estimated to increase living donor rates by roughly 18%. Lastly, we find evidence that increases in disposable income per capita is associated with an increase in the number of non-biological living donors within a state, but is not found to have an effect on biological donor rates.

And here is EL's summary:

"There are times where you really wonder why authors would even think that some variables could be correlated and how they then come up with a story that can explain this statistical relationship coming from seemingly nowhere. The paper by Jose Fernandez and Lisa Stohr is one of these.To quote their abstract, "this paper uses variation in traffic safety laws and obesity rates to identify substitution patterns between living and cadaveric kidney donors." Despite reading this sentence ten times, I could not make any theoretical sense of it. But reading through the paper, a good story can be made. Tightening traffic safety laws reduces the number of fatalities, and thus the number of cadaveric organ donors. An increase in obesity increases the demand for organs, in particular kidneys. Thus one can instrument for supply and demand using these measures. With this in mond, one can then study how variations in the supply of supply of cadaveric organs (which are of poor value) and demand can motivate living donors to come forward, as they trade off the usefulness of their donation with the personal harm it will inflict upon them. Fernandez and Stohr fiand that donors respond indeed to cadaveric supply and to the increase in demand due to obesity."

Markets for body parts, continued

While it's illegal to buy or sell organs for treatment, there's a legal market for "tissues" such as bone. But it's still fenced in with lots of repugnance. As with solid organs, the issue of "objectification" (or "commodification") of the body is a big issue, which bears on who may be compensated for what, among other things..

Inside a Creepy Global Body Parts Business

"According to the American Academy of Orthopedic Surgeons, more than a million bone parts are used in transplants every year. In no other country is it possible to make so much money with body parts. If a body were disassembled into its individual parts, then processed and sold, the total proceeds could amount to $250,000 (€176,000). For a single corpse! The US tissue industry generates total revenues of about $1 billion a year, says journalist Martina Keller, a co-author of this article and the author of the German book, "Cannibalized: The Human Corpse as a Resource." "
...

"Should corpses be butchered to make cosmetic procedures possible? Ingrid Schneider is decidedly opposed to the practice. For the past 15 years the Hamburg political scientist, a former member of the Investigative Commission on Law and Ethics in Modern Medicine in the German parliament, has been involved in the subject of recycling body substances. Schneider argues that the body is not a source of raw materials that can be sold at will. Given such concerns, it is not surprising that many people are deeply opposed to allowing the body of a family member to be reused, even for medical purposes.
Even if it is unrealistic to expect that all commercialization of the body could be ruled out in modern medicine, says Schneider, it is important to set boundaries. For that reason, she insists that human tissue ought to be used sparingly -- that is, only when such use is medically necessary and clearly superior to other forms of treatment.
The conviction that the body is much more than an object has also shaped the policies of the World Health Organization (WHO), the European Parliament and the European Council, the EU's body representing the leaders and ministers of the 27-member bloc. All of these bodies condemn the practice of trading in human body parts to turn a profit.
In Germany, the country's organ transplant act regulates the removal of tissue. Only those who have consented to organ and tissue harvesting are considered as donors. If a person dies and is not already a donor, his or her closest relatives can consent to donation. Paragraph 17 of the transplant act explicitly states: "Trading in organs or tissue intended for use in the medical treatment of others is prohibited." Physicians who remove tissue can only be paid suitable compensation for their efforts. The law calls for prison sentences of up to five years for violation of the trading prohibition."

Right to die in England

There has been some interim resolution of the continued debate in England about whether those who assist a terminally ill relative who wishes to commit suicide, in particular by accompanying them to a clinic in Switzerland, will face prosecution. The current resolution is, it's still illegal, but guidelines have been issued to give some legal safety.
Campaigners win the fight to legalise assisted suicide
Assisted suicide investigations will focus on who stood to benefit

"People who stand to benefit financially from a person’s death are likely to be the ones prosecuted for assisting a suicide, under guidelines to be issued this week. "...

"The policy...will aim to clarify when individuals are more likely to be prosecuted or more likely not to be, he said.
Mr Starmer told the Andrew Marr Show on BBC One that such factors will include whether the person has a clear and settled intention to commit suicide, whether they have been encouraged or just assisted to do so, and whether those helping them have anything to gain from their death."

..."As many as 115 people from Britain have gone to Dignitas, the Swiss clinic, to die, but no one has been prosecuted so far. Last month Mr Starmer said that the landmark guidelines would apply in the UK as well as overseas.
Under current legislation, those who “aid, abet, counsel or procure” someone else’s suicide can be prosecuted and jailed for up to 14 years. Ms Purdy, from Undercliffe in Bradford, West Yorkshire, wants to know what would happen to her Cuban husband, Omar Puente, if he helped her to travel abroad to end her life. She took her case to the Lords after the High Court and Court of Appeal held that it was for Parliament, not the courts, to change the law.
The Lords agreed that changes were a matter for Parliament, but upheld Ms Purdy’s argument that the DPP should put in writing the factors he regarded as relevant in deciding whether or not to prosecute."

The guidelines, which were issued on schedule, drew a predictably wide range of reactions, some of which can be found at the end of this story in the Times: Assisted suicide guidelines do not give immunity against prosecution, says DPP

Right to die in Montana?

May a physician help a terminally ill patient commit suicide? Or is that a terminally repugnant transaction, which even a willing patient and physician should be prevented by law from completing?

The question has been raised in Montana, and will go to the state supreme court: Montana Court to Rule on Assisted Suicide Case

"Washington and Oregon allow physicians to help terminally ill people hasten their deaths, but in those states the laws were approved by voters in statewide referendums, and neither state’s highest court has examined the issue of a constitutional right to die.
In Montana, the question will be decided by the seven-member State Supreme Court. A lower-court judge ruled in Mr. Baxter’s favor last December — on the very day Mr. Baxter died — and the State of Montana appealed the ruling."
...
"“There are moral arguments, philosophical arguments on both sides, bioethical arguments on both sides, even medical and public health arguments on both sides,” Anthony Johnstone, the state solicitor at the Montana attorney general’s office, who will argue the case for the state, said in defense of current laws that prohibit physician-assisted death. "
...
"“This case is part of a journey,” said Ms. Tucker, who is director of legal affairs for Compassion and Choices, a national group that advocates to protect and expand the rights of the terminally ill and is also one of the plaintiffs. “It’s about empowering patients and giving them the right to decide when they have suffered enough.”"

Update: Dec 31, 2009. Montana Ruling Bolsters Doctor-Assisted Suicide
"The Montana Supreme Court ruled on Thursday that state law protects doctors in Montana from prosecution for helping terminally ill patients die. But the court, ruling with a narrow majority, sidestepped the larger landmark question of whether physician-assisted suicide is a right guaranteed under the state’s Constitution."

Right to wed in Vermont

Same-Sex Marriages Begin in Vermont


"Vermont is one of five states that now allow same-sex couples to marry. Massachusetts, Connecticut, New Hampshire and Iowa are the others.
Vermont, which invented civil unions in 2000 after a same-sex couple challenged the inequality of state marriage statutes, was a mecca for gay couples who to that point had no way to officially recognize their relationships.
Since then, other states have allowed gay marriage, as did Vermont, which in April became the first state to legalize gay marriage through a legislative decree and not a court case."


See my other posts on same sex marriage, and more generally on repugnant transactions, i.e. transactions that some people want to do but that others object to.

Egg "donation"

Do a google search for egg donor and and open a window on a thriving marketplace for human eggs, with well established companies such as Egg Donation, Inc. ("where dreams come true") competing with a host of others. The word "donor" is entirely vestigial in this context (as the "..., Inc.") makes clear, and the repugnance that used to accompany such sales is becoming vestigial as well.

The Minneapolis Star Tribune ran an interesting story about that firm some time ago, by Josephine Marcotty and Chen May Yee: Oct. 21, 2007: Miracles for sale.

The article describes the modern egg donor:

"The clinics want donors who have a healthy blend of altruistic and financial motives -- women who want to help infertile women but who are practical enough not to do it for free. "

Choosing sex of children: repugnant in Britain but not in U.S.

The Times reports: US clinic offers British couples the chance to choose the sex of their child

"A new clinic in Manhattan is appealing to British couples who want to pick the sex of their next child — a process that is banned in the United Kingdom.
Pre-implantation genetic diagnosis (PGD), which can reveal the sex of an embryo, is prohibited in Britain except when it is used to screen for genetic diseases.
The United States relaxed its regulations on sex selection in 2001 and American medical centres report interest from British patients who find out about their “family balancing” services through online advertisements. "
...
"As recent healthcare debates show, many Americans balk at government involvement in medicine. Robert Brzyski, chairman of the ethics committee at the American Society for Reproductive Medicine, said: “The tradition in the US has been to not interfere with the reproductive choices of American citizens.” "
...
"Although evidence suggests that British patients tend to pick sons and daughters in roughly even numbers, most US clinics will treat only those parents who already have a child of the other sex. "
...
"David Karabinus, a director at the Virginia institute, believes that elective sex selection will eventually be seen as just another form of reproductive medicine. “Just as there was an overreaction about IVF, there will be a gradual acceptance as we prove it’s safe. It’s there if people want it.” "

Living donor liver transplants

One of the reasons that kidney exchange is proving successful is that the dangers to donors seem to be quite low. In principle, liver exchange is also a possibility: a healthy donor can donate one lobe of his liver, and expect it to grow back. But a recent study of live-donor liver transplants at the pioneering University of Pittsburgh Medical Center reveals that the rate of complications for live liver donors may be quite high: UPMC liver transplant study finds flaws: Study reveals high rate of complications from UPMC procedures that used living donors .

"The study looked specifically at operations in which the larger, right lobe of the donor's liver was removed, and said that "no matter how carefully right lobar [living donor liver transplant] is applied, the historical verdict on the ethics of this procedure may be harsh. There is no precedent of a surgical procedure that exposes healthy persons to such a high risk on behalf of others."
While all 121 liver donors were still alive at the time the study was written, more than 10 percent of them also suffered serious postoperative complications.
The study also concluded that while some people argue that living donor transplants keep recipients from becoming critically ill while waiting for an organ, "in a reversal of fortune," 11 of the 121 recipients became so sick after their initial transplants that they had to get second livers from deceased donors. Only five of the 11 were still alive at the time the study was written."

The article also offers a window on the complicated decisions facing transplant surgeons generally (and not just liver transplant surgeons) about which patients should be offered a transplant. The news story quotes one doctor summarizing the issue as follows:

""I think the study's authors are ...also are bringing out the whole issue that we need to be careful and not just charge ahead and let cowboys do this procedure" "

Kidney Exchange and Nurse Coordinators

Lots of people play critical roles in making kidney exchange a reality, and a recent article emphasizes the enormous role played by nurse coordinators: Nurses: Kidney Exchange Registries Increase Compatability, Hope:

"Nurses Make It Happen: The foundation for these exchange programs is collaboration among transplant centers and the cornerstone is the nurse coordinator at each facility. These nurses are in frequent contact and are negotiating solutions as problems occur. They coordinate schedules and shipping arrangements to get the kidneys where they are needed in the shortest possible time. “We often ship the kidney to the recipient because it can be hard for donors to travel,” Charlton says. “There are times the donor is in California and the recipient is on the East Coast. The coordination among transplant centers is a massive undertaking.”Morgievich and Charlton agree the nurses who coordinate the exchanges are the driving force that makes the whole complex machine run. Larger transplant centers are the major players because they have the expertise and resources to be innovative about approaches to exchanges. Operating room schedules have to be coordinated, and detailed logistical communication schedules are set up across miles and time zones, so that as the living donor kidneys are removed and prepared for transport across the hall or across the continent, the recipient is ready. Although the surgical procedure is similar in every case, surgeons share details about the anatomy of the organ with the receiving surgical team. "

"Morgievich notes that if anyone entered “kidney exchange” into an Internet search engine five years ago, they would have had negligible results. A Google search today produced 1.2 million results in less than a second.“This is a whole new ball game, and we’ve had to create new ways to look at sharing best practices. We’ve even had to create a language for the way it works,” she says. “When we have paired donor and recipients combined with an altruistic donor, we usually have a donor at the end of the chain. We sometimes hold that donor over or find an appropriate recipient from the wait list. That last donor in the chain is called a ‘bridge donor’ because sometimes they wait until we can organize another series of exchanges. They are the bridge to the new chain.” "

Here's the google search for kidney exchange, and here are my previous blog posts with kidney exchange as a tag.

The kidney supply chain

The Minneapolis Star Tribune has given its health reporter Josephine Marcotty unusual scope to write about kidney transplantation in a multi-part series on kidney failure, treatment, and transplantation, and she has done them proud.

Part 1: 'Survival of the savviest' explored the challenges of being on dialysis, waiting for a deceased donor, and looking for a live one.

"But the two supply systems -- living and deceased -- remain radically different. Organs from deceased donors are viewed as a public asset -- like national parks -- and their allocation is highly regulated for fairness and transparency. There are disparities in who earns a spot on the deceased donation list, but they are generally viewed as a consequence of inequities in the overall health care system. A living donation, on the other hand, is a private gift from one person to another. Except for a federal law that makes selling organs a felony, there is no oversight and no support for living donation by the government or the transplant community. As a consequence, finding a living donor is often a matter of wealth, social advantage -- or pure luck."

Part 2: Balancing life and death looks at the process by which willing live kidney donors are accepted or rejected, a process that involves both whether their kidney is compatible with their intended recipient, and their own health. The story says that the first undirected living donor was accepted in Minnesota. More generally,

"Competition between transplant centers is fierce. Minnesota, for example, has four hospitals that compete for kidney patients and organs. If one transplant center changes its standards, sooner or later the others often follow. One reason is that everyone, except perhaps the living donor, benefits. Patients fare better because kidneys from living people tend to be better quality than those from the deceased. The doctors have more control over the complex surgeries. Hospitals, for their part, make more money. Medicare pays an average of $106,000 for a transplant, regardless of whether the kidney comes from a living or deceased donor. And living donor transplants generally cost less -- about 15 to 20 percent less at the university hospital, for example. That means the hospital stands to make 15 to 20 percent more per surgery."... "Nevertheless, taking a kidney from a living person presents daunting ethical questions. In the early days of transplant medicine, things were simpler. Only genetically related relatives were accepted as donors. But family dynamics are complex; doctors and hospital social workers sometimes had to find ways to say "no'' on behalf of reluctant relatives who couldn't find the courage to say no themselves. "There's much more coercion in families than outside of families," said Dr. Stephen Textor, a kidney specialist at the Mayo Clinic. In other cases, saying no was next to impossible. "The people who really pushed it? Spouses," Garvey said. "You have your husband sitting in front of you, dying. They were telling us, 'Who are you to tell me I can't be a donor?' They were right." "

Kidney failure, Part 3: A revolution: trading donors is the installment that first caught my eye, as it deals with kidney exchange. Marcotty reports on what must have been some long interviews with Mike Rees, the surgeon responsible for many of the most important innovations in kidney exchange.
The article begins with this subheadline:
"Kidney exchanges use the oldest economic model of all - trade. Computer matching can start a chain of transplants, but the idea has a long way to go."

I even make a cameo appearance in her story, where I often am, on the phone:
"Then in December 2006, Rees spent an hour-and-a-half on the phone with Alvin Roth, a Harvard economist who specializes in matching theory.
Roth has devised many matching programs, including the national system that fits medical students with specialty training centers.
He also studies what has been jokingly described as "ick-onomics" -- the economics of repugnance. For instance, most people abhor the idea of selling human body parts for transplant. But trade? That doesn't usually trigger the same kind of visceral reaction, he said."

Marcotty describes how Rees initiated the first non-simultaneous chain, through the words of the altruistic donor, Matt Jones, who started it off.

"It began with Matt Jones, a 30-year-old father of five who worked for Enterprise car rental in Petoskey, Mich. He was determined to give his kidney to anyone who needed it.
His first attempt to donate fell apart when the patient unexpectedly got a kidney from the deceased list. But after putting time and money into travel and testing, and persuading his fiancé at the time that it was a good idea, he wasn't about to give up. He called Rees.
"He tells me, 'I have this idea of doing a chain,'" Jones said in an interview. "'It's never been done. There are some people who think I'm crazy.'
"I said, 'Sounds like a great idea.' "

(Mike spends a lot of time on the phone too:)

(Here's my earlier post about that first non-simultaneous chain.)

Marcotty continues the story of non-simultaneous chains: "In March, Rees described his chain in a New England Journal of Medicine article titled "A nonsimultaneous, extended, altruistic-donor chain.... The number of transplants from swaps and chains is growing exponentially. In July, an eight-way multi-hospital series of transplants was conducted in four states over three weeks. In March, a series of six transplants was conducted at three hospitals around New York in 36 hours.
In Boston last spring, kidney exchanges were one of the hottest topics at the American Transplant Congress, a major international conference. Hundreds of surgeons, nurses and social workers absorbed PowerPoint slides that illustrated intricate webs of matches by race, age, medical condition, genetics and blood type. Instead of presentations on anti-rejection drugs, they learned about software programs."

Part 4: The ethics of kidney donation: Two views

The two views are pro and con on whether compensation for donors would improve the supply of donor kidneys, or whether this is too repugnant to contemplate. The pro position is taken by Dr. Arthur Matas, an eminent surgeon and former president of the American Transplant Society. His bottom line:

"It is immoral to stand by and watch patients die when we have the means to save them. A regulated system of compensation for donation has the potential of saving lives, shortening the waiting list and improving transplant outcomes. A regulated system protects the interests of donors. Unless Congress lifts the ban against compensation and allows pilot programs, we are guaranteed more needless death and suffering."

The con position is taken by Jeffrey Kahn, a bioethicist. His bottom line:

"Organ donation has always relied on the altruism of donors and their loved ones, with the hope that any risk for the patient is balanced by the benefit of the good deed. But most people have a price at which they might ignore whatever qualms they have about donation and become willing sellers. That changes the relationship -- from giving a gift to being paid enough to ignore the risk.
A market allows this shift, and it is a change we should be loath to accept."

Declaration of Istanbul update

I received an email regarding the 2008 Declaration of Istanbul, intended to slow/halt/reverse transplant tourism and black markets for organs. It states in part:

"On September 30, 2009, the Steering Committee of the Declaration of Istanbul met in Beirut, Lebanon, in conjunction with the Congress of the Asian Society of Transplantation, to formulate a strategy and plans for the continued implemention of the Declaration."

"Updates:
· Since the November 2008 Steering Committee meeting, there has been a reduction in organ trafficking and transplant tourism in China, the Philippines, and Pakistan. Israel has enacted legislation that impedes Israeli citizens from receiving insurance coverage for transplants performed outside of Isreal if the destination country prohibits foreign patients from undergoing transplantation. There has been a recorded reduction in foreign transplants in Colombia from 12 % to 1 % of transplants performed.

· More than 80 professional organizations and societies have endorsed the Declaration of Istanbul.

· On October 13, 2009 a Joint Report by the Council of Europe and the United Nations will be presented in New York at the United Nations to launch a global effort in combating human organ trafficking.

· In March 2010, the WHO will hold its 3rd Global Consultation on transplantation in Madrid, Spain (in collaboration with TTS and ONT) to foster the development of self sufficiency in each nation in providing organ transplants for its residents. "

"Mission Statement:
The Mission of the Declaration of Istanbul Custodian Group (DICG) is to promote, implement and uphold the Declaration of Istanbul so as to combat organ trafficking, transplant tourism and transplant commercialism and to encourage adoption of effective and ethical transplantation practices around the world. "


"The following GOALS have been identified for these revised Task Forces:

I. Professional Organizations:
· Professional Organizations require that speakers at scientific and educational meetings on clinical organ transplantation disclose whether the clinical and research activities being reported have complied with the Principles of the Declaration of Istanbul.
· Professional Organizations have an established mechanism for determining the appropriateness of accepting presentations on clinical organ transplantation based on the disclosure of their compliance with the Principles of the Declaration of Istanbul.
· Organizations that endorse the Declaration of Istanbul establish mechanisms to promote, implement and uphold the Declaration (for example, through their ethics committees, awards and membership criteria).

II. Medical and Scientific Journals:
Medical and scientific journals require that authors of articles relating to clinical organ transplantation disclose whether the clinical and research activities being reported have complied with the Principles of the Declaration of Istanbul.
Medical and scientific journals have an established mechanism for determining the appropriateness of accepting presentations on clinical organ transplantation based on the disclosure of their compliance with the Principles of the Declaration of Istanbul.

III. Pharmaceutical Companies and Other Research Sponsors:
· Pharmaceutical companies establish a mechanism to ensure that the clinical studies of organ transplantation they support comply with the Principles of the Declaration of Istanbul.
· Pharmaceutical companies disclose whether the clinical studies of organ transplantation they support comply with the Principles of the Declaration of Istanbul.
· All organizations and individuals that fund clinical studies of organ transplantation establish a mechanism to ensure that these studies comply with the Principles of the Declaration of Istanbul.
· All organizations and individuals that fund clinical studies of organ transplantation disclose whether these studies comply with the Principles of the Declaration of Istanbul.

IV. Violations of the Declaration:
· Violations of the Principles of the Declaration are drawn to the attention of relevant healthcare authorities and institutions and medical societies as well as to the World Health Organization and other relevant intergovernmental organizations.

V. Government and Healthcare Institutions:
· Governments and responsible national authorities adopt and implement policies, laws and regulations in accordance with the Principles of the Declaration of Istanbul and the WHO Guiding Principles on Human Cell, Tissue and Organ Transplantation.
· Hospitals and other healthcare institutions engaged in organ transplantation services adopt and implement policies in accordance with the Principles of the Declaration.
· National and institutional ethics committees develop policies concerning organ transplantation which are in accordance with the Principles of the Declaration."

In related news, the United Nations and the Council of Europe have launched a study on "Trafficking in organs, tissues and cells and trafficking in human beings for the purpose of the removal of organs". (Here's a brief news report.)

Peter Singer on compensating kidney donors

Kidneys for Sale? by Peter Singer

The distinguished Princeton philosopher of bioethics takes a nuanced view of the matter of compensation for donors, in a discussion of organ sales that touches on New York, Singapore, and Iran.

HT: Joshua Gans

31 States have laws against price gouging

So reports Michael Giberson at KP, based on a Master's thesis by Cale Wren Davis, supervised by Randy Rucker at Montana State. The thesis is here: AN ANALYSIS OF THE ENACTMENT OF ANTI-PRICE GOUGING LAWS.

I'm struck by how relatively recent anti price gouging laws are: 27 of the 31 were passed in the 1990s or 2000s, with the rest passed in 1979 (NY), 1983 (HI), 1986 (CT), and 1986 (MS).

The laws come into force when some kind of state of emergency has been declared, and most set a price ceiling at "pre-emergency prices," although some set a ceiling higher than that, the highest being 25% above pre-emergency prices.