The Carob Trust Prize for Academic Courage: An award for scientists who overcome unjustified attacks on their work

 Here's the announcement of a new prize, initially to be awarded for work in the social sciences, reflecting the fact that social science can be politically contentious.

The Carob Trust Prize for Academic Courage: Celebrating the Pursuit of Knowledge 

"The Carob Trust Prize honors academics who pursue bold ideas that challenge prevailing orthodoxies—whether political, intellectual, or methodological—and hold the potential to reshape knowledge, policy, or society. The Prize supports scholars whose work is original, rigorous, impactful, and courageous—even when it is unpopular. " 

"Selection Criteria
Intellectual Independence: A proven commitment to following logic and evidence wherever they lead, regardless of academic or political pressure.
 

Non-Conformist Ideas: Originality and boldness of research agenda. Willingness to ask questions that others avoid—whether uncomfortable, underfunded, or unfashionable.
 

Impact and Vindication: Work of excellent quality that has shifted academic debate, public discourse, or policy. Evidence that ideas criticized at the time have proven—through data, replication, or influence—to possess enduring value. "

"Timeline
Nov. 1, 2026:  Nominations due
Spring 2027:Announcement of Prize winners "

 #######

Here's a column in the WSJ about the prize:

An Award for Scholars Who Tell the Truth
The Carob Trust Prize for Academic Courage will honor social scientists who face unjustified attacks.
By Roland Fryer and Bill Ackman 

Ukraine weighs legalizing pornography to raise tax revenue and buy drones

 Here's a story from the WaPo whose headline already conveys a lot about the economics of tradeoffs:

Ukraine weighs legalizing pornography to raise tax revenue and buy drones
Facing a massive defense budget shortfall, Ukraine has not been able to cash in on the millions of dollars earned by its clandestine adult-content industry. By Francesca Ebel and Anastacia Galouchka
 

"KYIV — For years, Ukraine’s huge but illegal porn industry has operated in the shadows. Law enforcement generally looked the other way, while some officials abused their power to extort bribes from people found to be skirting the law.

"Then, two years into Russia’s full-scale invasion, the federal tax authorities discovered that nearly 8,000 Ukrainian OnlyFans creators had made more than $131 million during 2023 alone.

"Now, with Ukraine facing giant military expenses and a $27 billion budget gap, lawmakers are moving to decriminalize pornography — a momentous step for a country long stained by a reputation for exploiting and exporting women as sex workers. 

...

"Raising money on the backs of adult-content creators, however, is a fraught proposal in Ukraine, where the women’s protest group Femen rose to worldwide fame by demonstrating topless to decry sexual exploitation and patriarchal authoritarianism.

"Critics of the bill fear that it could undermine public morality, as well as increase the risk of human trafficking and child sexual abuse. 

...

"Supporters of legalization say that it will protect women, not encourage abuse.

“Human trafficking is based on coercion: A person is deceived; their documents are taken away,” Oksana said. “The modern creator economy is completely different. An adult woman verifies her identity and age on the platform and determines her own boundaries.” 

Iran's kidney market, reviewed in Al-Madina: Journal of Islamic Law

The new English language journal Madina: Journal of Islamic Law has, in it's inaugural issue, a literature review of the Iranian kidney market. (It appears only to have reviewed papers that were also published in English.) The title summarizes the conclusion, that the market aligns with the goals of Islamic law.

Faisal, Ahmad, Abdul Khakim Mahfud Zubaidi, Ahmad Nizar Zuhdi Al Hakimi, and Roya Goldoust. “The Iranian government’s efforts to facilitate foundation-led kidney donation align with the Maqāsid al-Sharī’ah.” Al-Madina: Journal of Islamic Law 1, no. 1 (2026): 28–48. 

Abstract
The issue of kidney transplantation, particularly through compensated living-unrelated donors, represents a complex intersection of medical necessity, ethical debate, and international governance. Iran is unique in legally regulating compensated kidney donation, aiming to address the chronic shortage of transplantable organs while providing structured financial incentives to donors. This study analyzes Iran’s
kidney donation system through the lens of maqāsid al-sharī’ah, emphasizing the objective of hifz al-nafs (preservation of life), to evaluate both the ethical legitimacy and life-saving effectiveness of the policy. Employing a qualitative-descriptive approach, the research synthesizes empirical evidence on donor demographics, motivations, compensation mechanisms, and clinical outcomes, alongside normative Islamic ethical considerations and international standards such as the WHO Guiding Principles and the Declaration of Istanbul. Findings reveal that while Iran’s system significantly enhances patient survival and fulfills the core goal of hifz al-nafs, donor participation is heavily influenced by economic necessity, raising ethical concerns about voluntariness, long-term welfare, and equitable access. Moreover, the system’s interaction with foreign patients highlights challenges in cross-border governance and the potential for transplant tourism. The study contributes academically by integrating empirical outcomes with Islamic normative ethics, and practically by offering insights for policymakers, religious authorities, and international health organizations on navigating the tension between life preservation, ethical legitimacy, and socioeconomic realities. The research underscores that while the Iranian model demonstrates pragmatic life-saving benefits, ethical safeguards for donors must remain central to uphold the objectives of maqāsid al-sharī’ah."

Organ trafficking research

 Frederike Ambagtsheer is the principal investigator of a Dutch project conducting organ trafficking research, whose website discusses their work:

welcome to organ trafficking research

This platform presents research projects on the human organ trade that are conducted by Erasmus MC's Organ Trafficking Research Group. We further provide information for interested audiences (e.g. students, researchers, law enforcement, law -and policy-makers, etc) about the complexities of this crime and the responses there-to.

The organ trafficking research group is based at Erasmus MC's Department of Internal Medicine, Section Nephrology and Kidney Transplantation in Rotterdam(opens in new tab), The Netherlands. This department is part of the recently established Erasmus MC Transplant Institute (opens in new tab)which houses one of the largest kidney transplantation centers in Europe.

...

what we do

We are an enthusiastic and dedicated team of researchers that conduct empirical research on different facets of organ trade and trafficking. Our research is structured into various projects. Methods include a mix of qualitative and quantitative research strategies including systematic literature reviews, surveys, ethnographic research, crime scripting and network analysis.

We conduct research in countries across the globe and we focus on all stages of the organ trading chain, including organ buying, selling, the organisation of illegal transplants and law enforcement responses. We also explore alternative measures such as allowing financial rewards for organ donation. In addition, we advise governments and (inter)national organizations on how to address organ trade problems.

Our research is funded by organisations including the European Commission, the European Research Council and the Dutch Research Council (NWO)."

 

 

Heroin, hitmen and black markets on Behavioral Grooves

The hosts of the podcast Behavioral Grooves open by chatting about heroin and hitmen, followed by a discussion among the three of us: 

  Behavioral Economics: When Markets Clash with Morals | Al Roth

"Horse meat, kidneys, prostitution. What happens when the things people want to buy, sell, and trade collide with what society has deemed “off-limits”? Nobel Prize-winning economist Alvin “Al” Roth joins us to explore the behavioral science behind controversial markets, from repugnance and social norms to black markets, incentives, and informed consent. We also dig into his work redesigning the kidney exchange market and how asking a different question can open up new possibilities for solving seemingly impossible problems.

Topics
[0:00] Intro and Speed Round with Alvin “Al” Roth
[9:21] What Is a Market?
[13:10] Repugnance vs. Disgust
[20:00] How Social Norms Shape Markets and Morality
[24:12] Do Laws Change Morality, or Does Morality Change Laws?
[28:25] Drugs, Hitmen, and the Social Support Behind a Ban
[34:23] Rethinking the Market for Prostitution
[38:12] Can Money Be Coercive?
[46:12] Redesigning Kidney Donation With Incentives
[50:42] What Do We Do When the Data Can't Change Minds?
[52:47] “Ought Implies Can” and the Limits of Moral Rules
[1:03:05] Grooving Session: What We Learned From Al Roth"

Moral Economics in Korean

Here's the first commercial translation I've seen of my book Moral Economics, which appeared in English in May 2026.

 I suspect that, now that A.I. can offer substantial assistance, some translations will appear more rapidly than in the past. 

The title in Korean is 금지된 거래의 경제학도덕과 시장은 공존할 수 있는가, The Economics of Forbidden Transactions: Can Morality and Markets Coexist? (You can buy it here.)

 

Here's a book review in the Seoul Economic Daily.

Here's another. Both are in English.

School choice: peer effects and social justice

 The not-so-secret secret of building a good school is to have good students. And sometimes that can lead to conflicts between the desire to build better school systems to serve children in the aggregate, and the desire to put your child in the best school for him or her.  

A NYT columnist talks about this, writing "In New York, a combination of housing segregation and “academic” sorting, called school choice, that begins as early as pre-K means most Black students — even middle-class ones — are forced to attend racially segregated schools with high rates of poverty." (emphasis added)

In Fighting for Every Black Child, Did I Betray My Own?
A decade ago, I made a decision about my daughter’s education that I hoped would challenge New York City’s separate and unequal school system. Now 16, she thinks I made the wrong choice. By Nikole Hannah-Jones

#######

On a somewhat related note, when I speak to prospective PhD students who are visiting universities after being admitted to multiple PhD programs, I encourage them to talk to the graduate students already there, and discover how happy, productive, and collaborative they are.  A good PhD program is one where you learn a lot by collaborating with your fellow students in study and research. 

There's life after tenure denial: Emily Oster (on Mary in America)

 That there is life after tenure-denial is robustly proclaimed and manifested by Emily Oster, in the opening minutes of an interview by Mary Childs on her podcast Mary in America.  There is also, apparently, a Tshirt advertised on the internet saying "Emily Oster is wrong."

 

x 

 

 

Market Design Impact Award to Yan Chen

 Here's the announcement from INFORMS:

Announcing the Winner of 2026 Market Design Impact Award

 "The Auctions and Market Design section of INFORMS is pleased to announce that Yan Chen, Daniel Kahneman Collegiate Professor of Information at the University of Michigan School of Information, has been selected as the recipient of the 2026 Market Design Impact Award. The award will be presented at the AMD Business Meeting at the INFORMS Annual Meeting in San Francisco, tentatively scheduled for Monday, November 2, 6:45–7:45 PM.

Award citation:
"For pioneering behavioral market design-combining theory, digital experiments, and large-scale field experiments-with lasting impact on the practice of market design, including the reform of Chinese college admissions, the organization of gig workers on ride-sharing platforms, and the design of recommender systems that increase contributions to digital public goods."

Now in its second year, the Market Design Impact Award recognizes major contributions to market design-original research from the past fifteen years that has had a lasting impact, directly or indirectly, on the field and/or the practice of market design.

Award Committee:
Eric Budish, The University of Chicago Booth School of Business
Tim Roughgarden, Columbia University
Nicolas Stier, Meta

Conflicts of interest were carefully handled such that they would not influence the committee decision. "

#########

Here's last year's (inaugural) award:

Friday, October 31, 2025 Market Design Impact Award to Hassidim, Romm, and Shorrer

 

A passionate proponent of transplants is (temporarily) unregistered as a donor: Greg Segal in the NYT

I'm a little shaken to learn that (even*) Greg Segal has temporarily suspended his registration as a potential deceased organ donor.  My registration remains active, but I'm watching with attention the regulatory and other reforms that are being contemplated for the system of deceased donation in the U.S.

What I Found Out About Organ Donation Shocked Me
By Greg Segal
Mr. Segal is the founder and chief executive of Organize, a nonprofit focused on reforming the organ donation system. 

 "I founded Organize, a nonprofit making it easier to register to become an organ donor. In 2015, Organize was selected for a role embedded inside the U.S. Department of Health and Human Services, which put us on the radar of whistle-blowers. I soon became inundated with allegations from people working inside the organ donation industry who felt they had nowhere else to turn.

"I know as well as anyone that organ donation saves lives — over 40,000 annually in the United States in recent years. But I was stunned to learn that organ procurement organizations — the federal contractors that coordinate organ donation from the deceased — that made those transplants possible were routinely violating ethical standards and putting patients at risk.

"I heard allegations of negligence and financial fraud, including industry executives’ billing taxpayers for joyrides on private jets meant to transport organs; of organizations performing unnecessary procedures as part of a scheme to overbill Medicare. (Organ procurement organizations are nonprofits, but that doesn’t mean they aren’t trying to maximize financial reimbursements.) I’ve heard of poorer Americans waiting to receive organs passed over in favor of wealthier ones.

"But one case in particular led me to remove myself from the donor registry and testify before Congress."

#######

He goes on to recount one of the most disturbing cases reported recently in the NYT (which I think were at least in part uncovered through the work of his Organization).

See

Friday, June 6, 2025 Disturbing NYT report about an Organ Procurement Organization in Kentucky

 and

Sunday, July 20, 2025  Organ donation after circulatory death: the NYT recounts some disturbing cases

also

*Saturday, August 9, 2025  Withdrawals from deceased donor registries   

Micheal Kremer's next (post-Nobel) Act: The World Bank

 Michael Kremer, one of the most  creative and dedicated economists of our time, has found his next act, at the World Bank.  (Sometimes the news is encouraging, even nowadays.)

Here's the press release from the World Bank. 

Michael Kremer Appointed as World Bank Group Chief Economist

"WASHINGTON, September 16, 2026—World Bank Group President Ajay Banga announced that Nobel laureate Michael Kremer has been appointed as World Bank Group Chief Economist and Senior Vice President for Development Economics, bringing one of the world’s foremost development economists to lead the institution’s research, data, and analytical agenda.

"Kremer is known not only for tackling real-world problems through innovative solutions grounded in rigorous research but also for translating his findings into programs that have reached hundreds of millions of people, from expanding vaccine access and school health programs to supporting smallholder farmers." 

Would Jesus like Waymo?

Are robots (and robot cars) repugnant?  To Baptists?  

The Washington Post has the story:

Would Jesus like Waymo? Baptists have thoughts.
As religious groups contend with artificial intelligence, some Baptist pastors are lobbying against a bill that would allow driverless cars to operate commercially in D.C. They say autonomous vehicles are antihuman. By Liam Scott
 

"Would Jesus like Waymo? The Rev. A. Michael Charles Durant doesn’t think so.

“Jesus either walked or rode a beast,” Durant said in an interview at the Tenth Street Baptist Church in Washington, where he serves as pastor. “He would be opposed to technology that was opposed to people, and I believe that this is opposed to people.”

...

"In recent months, Durant has joined local Baptist pastors and other top leaders in the National Baptist Convention — which bills itself as the largest Black religious organization in the United States — in opposing autonomous vehicles, including in the District, where the D.C. Council is weighing a bill that would legalize their commercial operation.

...

“God created us to be interdependent,” Durant said from his green-carpeted office. “The greatest danger is not that humans will be not needed, but that we create an environment where humans don’t need each other.”

"Their opposition to autonomous vehicles comes as religious communities grapple with artificial intelligence and what the technology means for the human condition and all its messy beauty.

“Automation can dehumanize humanity. The Book of Genesis declares that God created man, and then he breathed into man’s nostrils, and man became a living soul,” said C.H. Johnson, the pastor at Christ Missionary Baptist Church in Maryland. “If we’re not careful, technology can rob us of our humanity, can rob God’s creation of our humanity.” 

...

"In his first encyclical, published in May, Pope Leo XIV elevates the ethics of AI to a religious imperative. In “Magnifica Humanitas,” Leo argues that the unconstrained proliferation of AI may threaten humanity and foster inequity.

...

"Not all religious leaders oppose robotaxis. At an April event hosted by the Innovation Majority Institute think tank, the Rev. Thomas Bowen, from Shiloh Baptist Church in D.C., recalled when taxis drove right by him as a Black man in the District and New York years ago. He said he was excited when Uber and Lyft came on the scene but that he has faced similar issues with those services.

“Why should I have to put on a suit to get a taxi?” said Bowen, who is the general secretary of the Washington-based Progressive National Baptist Convention.

...

"For the National Baptist Convention’s annual gathering this week in Florida, Durant, chairman of the group’s board, prepared a video to screen in which he called on his fellow pastors to oppose autonomous vehicles in their communities around the U.S." 

"The single most important quality in a great researcher is to be lucky"

 Here's an interview recorded during my visit to Taiwan this past April.  It begins with my first reply:

"The single most important quality in a great researcher is to be lucky, and to find topics that are worth working on and that yield to investigation."

 

x 

A.I. guardrails: Trump Says “a STRONG AND SMART (High IQ!) PRESIDENT" is all that’s needed to rein in A.I.

 The debate over how to regulate, promote, and defend against new developments in A.I. has taken a market design turn, with increased calls for regulation to limit the likelihood of both unintended consequences and malicious use.  This apparently looks to President Trump like an easy problem, already solved.

The NYT has the story: 

Trump Says a Smart President Is All That’s Needed to Rein In A.I.
The president again rejected calls to try to regulate the industry, even as some of its leaders are speaking more openly about the risks of rapidly developing artificial intelligence.   
By Jonathan Swan Sept. 14, 2026


"President Trump on Monday rejected calls from leading artificial intelligence executives for new limits on the technology, writing on social media that the only guardrail the industry needed it already had: “a STRONG AND SMART (High IQ!) PRESIDENT.”

Congestion (and lawsuits) in applications for medical residency

  The figure below is a slide from a lecture I once gave about the transition from medical school to medical residencies in the U.S.  The lower row (in brown) represents the Match, which arose in the 1950's to deal with congestion in processing offers and acceptances. (Since 1998 it's been doing that successfully using the Roth-Peranson algorithm).  However the advent of electronic application systems has led to congestion in the application and interviewing process (top row, in blue).  And now that has led to lawsuits.

 

 Here's the story of one lawsuit:

 Residency Software Developer Sues Doctor Who Helped Launch a Competing Product
— AAMC-partnered Thalamus goes after key players in ResidencyCAS   by Rachael Robertson, MedPage Today, September 10, 2026 •

"The graduate medical education (GME) software company Thalamus filed a lawsuit against its competitor Liaison International and ob/gyn leader Maya Hammoud, MD, MBA, over alleged anticompetitive conduct.

"Thalamus brought the suit in July, claiming that the defendants "engaged in a coordinated effort to unfairly compete in the residency application market through anticompetitive means." Specifically, it alleges that Hammoud violated a non-disclosure agreement signed when she was evaluating its technology for a different project -- before she helped launch a competing product. 

########

 And here's the story of another:

Doctor Sues Over Residency Application System— Arizona wound care physician calls ERAS a monopoly that's gouging applicants  by Kristina Fiore,  MedPage Today, September 1, 2026  

"A physician is bringing antitrust claims against the Association of American Medical Colleges (AAMC) for what she alleges is a monopoly over the residency application process that's gouging doctors. 

...

"Hilgers PLLC, the Dallas law firm representing Buhrke, filed a similar suit against AAMC last year, alleging its medical school application service, AMCAS, was overcharging students. It made similar allegations against the law school application process.

...

"The current complaint alleges that AAMC makes a substantial part of its income from ERAS fees -- about $120 million annually, from about 64,000 applicants.

"Applicants often apply to dozens of programs in order to have a better shot at ensuring a residency position, at an average cost of about $1,800 per person. Buhrke submitted 81 applications through ERAS, paying $1,691 in total, according to the complaint.

"The vast majority of physicians use ERAS to apply, as it has only two competitors: ResidencyCAS for ob/gyn and emergency medicine, and SF Match for ophthalmology and plastic surgery.


"AAMC also took an equity stake in competitor Thalamus so that it wouldn't be a threat to its monopoly, the complaint alleged. "

Experimenting on the psychology of LLMs

 As LLMs become increasingly important, we're starting to see experiments that explore their psychology.

(I expect that   Susan Calvin, who was Isaac Asimov's fictional robopsychologist from the1950 short story collection I Robot, will soon have scientists following in her footsteps.)

Note that experiments intended to explore A.I. psychology need not necessarily resemble those intended to explore human psychology.

Here's an example,  from the journal Artificial Intelligence and the Law:
Human realignment: An empirical study of LLMs as legal decision-aids in moral dilemmas  by Christoph Engel · Yoan Hermstrüwer · Alison Kim
 

Abstract: Recent advances in AI make it conceivable to delegate legal decision-making to machines, or to enhance human adjudication through AI assistance. Using classic normative conflicts — the trolley problem and comparable moral dilemmas — as a proof of concept, we examine the alignment between AI legal reasoning and human judgment. In our baseline experiment, we find a pronounced mismatch between decisions made by GPT and those of human subjects. This misalignment raises substantive concerns for AI-powered legal decision-aids. We investigate whether explicit normative guidance can address this misalignment, with mixed results. GPT-3.5 is susceptible to such intervention, but frequently refuses to decide when faced with a moral dilemma. GPT-4 is outright utilitarian, and essentially ignores the instruction to decide on deontological grounds. GPT-o3-mini faithfully implements this instruction, but is unwilling to balance deontological and utilitarian concerns if instructed to do so. We replicate the experiment with four LLMs from different providers. Claude-sonnet-4.6 comes closest to human respondents. Gemini-2.5-flash-lite is most sensitive to normative instructions. Llama-4-scout and Mistral-nemo have a strong utilitarian bias, and do not strongly respond to normative interventions. At least for the time being, explicit normative instructions are not fully able to realign AI advice with the normative convictions of the population, or the legislator deciding on its behalf.

NBER Market Design Working Group Meeting, October at Stanford, Preliminary program

 Here's a preliminary program for the October NBER Market Design Working Group Meeting at Stanford

Market Design Working Group Meeting
Organized by Eric Budish and Michael Ostrovsky
October 16-17, 2026

Format: 35 minutes for the presentation, 10 minutes for discussion.
 

Friday, October 16
 
9:00 am    
Personalized Recommendations Without Inducing Congestion: Mitigating Disparities in the NYC High School Match
Erica Chiang, Cornell University
Kenny Peng, Cornell University
Rebecca Lichtenstein, New York City Public Schools
Brielle McDaniel, New York City Public Schools
Kristen O'Neil, New York City Public Schools
Dejaunique Thomas, New York City Public Schools
Lianna Wright, New York City Public Schools
Jon Kleinberg, Cornell University
Eva Tardos, Cornell University
Nikhil Garg, Cornell University
 

9:45 am    
Who Gets What in Education: Can School Matching Improve Student Achievement?
Atila Abdulkadiroglu, Duke University and NBER
Parag A. Pathak, Massachusetts Institute of Technology and NBER
Christopher R. Walters, University of California, Berkeley and NBER
 

10:30 am    
Break
 

11:00 am    
Searchable Menus
Frank Yang, Stanford University
Piotr Dworczak, Northwestern University
 

11:45 am    
Two-Sided Matching with Partial Participation
Assaf Romm, Hebrew University of Jerusalem
Ran Shorrer, The Pennsylvania State University
Avinatan Hassidim, Bar-Ilan University

12:30 pm    
Lunch and Conversation with Al Roth about his latest book, "Moral Economics"
 

2:30 pm    
Clearing Multi-Unit Markets with Simple Pricing
Ali Makhdoumi, Duke University
Saša Pekeč, Duke University
Xinchang Wang, Duke University
 

3:15 pm    
Quota Marketplace: Dynamic Pricing for Efficient Allocation of ML Training Resources
Renato Paes Leme, Google Research
Balasubramanian Sivan, Google Research
Mihai Tiuca, Google Research
Ian McFarlane, Google Research
Vasilis Gkatzelis, Drexel University
Nehal Mehta, Google Research
Soheil Hassas Yeganeh, Google Research
Vahab Mirrokni, Google Research
Amin Vahdat, Google Research
 

4:00 pm    
Break
 

4:30 pm    
One-Shot Pricing for Hands-Off-the-Wheel Advertising Markets
Emerson Melo, Indiana University
Matthew Shum, California Institute of Technology
Rakesh Vohra, University of Pennsylvania
 

5:15 pm    
Paying for Information, Not for Clicks: A Block-Level Publisher Content Marketplace for AI Answers
Markus Mobius, University of Michigan
Andras Sari, Central European University
Tanya Rosenblat, University of Michigan
David M. Rothschild, Microsoft Research
Brendan Lucier, Microsoft Research
Nicole Immorlica, Yale University
Oliver Kiss, Spreadmonitor
Jingyi Qiu, University of Michigan School of Information
Colin Watson, Microsoft Research
Ishan Mahajan, Microsoft Research
 

6:00 pm    
Adjourn
6:30 pm    
Group Dinner at Tamarine Restaurant, 546 University Avenue, Palo Alto
 

Saturday, October 17
8:00 am    
Continental Breakfast
 

9:00 am    
Screening for Usage
Justin Hadad, University of Oxford
Kyle Woodward, Assign Group
 

9:45 am    
Pricing the Right to Renege in Search Markets: Evidence from Trucking
Richard Faltings, University of California, San Diego
 

10:30 am    Break
 

11:00 am    
Competition and Welfare in Airport Slot Allocation
Sebastian D. Bauer, Universidad Carlos III de Madrid
 

11:45 am    
Road Pricing under Heterogeneity
Shoshana Vasserman, Stanford University and NBER
Brad Ross, University of Pennsylvania
Adi Shany, Tel Aviv University
Itai Ater, Tel Aviv University
 

12:30 pm    
Boxed Lunch and Adjourn 

Surrogacy (on each side of the Atlantic)

 Crossing the Atlantic today, to return home from Paris, this story in The Atlantic seems apropos:

Mothers for Sale.  Most of Europe bans commercial surrogacy. The United Nations likens it to slavery. But in the United States, business is booming.  By Helen Lewis

"Since the legalization of same-sex marriage, male couples have become the big growth market for American surrogacy, but the practice is booming among aspiring parents—married or single, straight or gay—who can afford the cost of hiring someone else to carry their child. In 2024, 11,821 embryos were transferred to surrogates in American clinics associated with the Society for Assisted Reproductive Technology, up from 8,461 three years earlier, and the United Nations estimates that the global worth of the industry is almost $15 billion. Most surrogacy in America today is commercial, meaning that the carrier is paid, and gestational, meaning that the carrier has no genetic relationship to the child.

...

" many liberal Americans are surprised to discover that their country is an outlier in its enthusiasm for commercial surrogacy. In Britain, where I live, a ban on the practice enjoys substantial support among feminists, who worry about the power differential between paid surrogates and wealthy would-be parents. (Altruistic surrogacy, in which the surrogate carries a baby solely out of generosity, is less controversial and is permitted.) A recent UN report went even further, declaring that commercial surrogacy “constitutes the sale of children, which is a crime,” and that “surrogacy arrangements can amount to or resemble slavery.” 

...

"Because so much can go wrong, every country in the European Union has banned commercial surrogacy. France’s centrist liberal president, Emmanuel Macron, has described the practice as “not compatible with the dignity of women.” Italy’s right-wing populist leader, Giorgia Meloni, has enacted one of the strictest anti-surrogacy frameworks in the world. Not only is domestic surrogacy banned, but any Italian citizen who brings home a baby born to an overseas surrogate risks jail and a fine of up to 1 million euros. Many other developed countries have either tightly restricted surrogacy or chosen, as Britain and Canada have, to allow only the altruistic version. Israel allows surrogacy but imposes a raft of conditions: The commissioning parents must not have more than two children already, must not have serious criminal convictions, and must be of the same religion as the surrogate.

"In general, Europeans think of Americans’ enthusiasm for paid surrogacy the way we regard their fondness for guns and capital punishment: inexplicable. The piquant difference, however, is that surrogacy is a cause of the American left rather than the right. Red states tend to have tighter limits on surrogacy. Louisiana, for example, restricts surrogacy to married heterosexual couples using their own sperm and eggs. By contrast, when New York legalized commercial surrogacy in 2020, LGBTQ activists hailed it as a triumph for “fertility equality.”

The debate cuts across political traditions and defies easy categorization. When surrogacy goes well, the result is a happy family that would not otherwise have existed. When it goes wrong, however, it can do so in unpredictable and emotionally crushing ways. At its core, the ethical question is this: How much physical and emotional risk should individuals be allowed to take on in the name of a commercial transaction? 

...

"America also stands virtually alone as a rich country that permits incoming surrogacy tourism from elsewhere. Many of these international intended parents are from China, where surrogacy is banned and where, until recently, family size was limited by the one-child policy. These customers have exacting standards. 

...

"Look abroad, though, and it’s a different story. Some agencies offer “guaranteed baby” packages for as little as $50,000. Surrogacy destinations pop up anywhere the local laws are lax, such as Northern Cyprus, a territory that exists in a legal limbo and is recognized only by Turkey. (The problem is that babies born there can end up stateless.) For parents from Russia, nearby Georgia is a similar no-questions-asked destination.

"India used to be the most favored low-cost destination, but in 2015, Prime Minister Narendra Modi, citing fears of exploitation, banned commercial surrogacy for foreigners. Ukraine’s appeal as a surrogacy destination has diminished since Russia’s invasion in 2022, although the leading agency there, BioTexCom, told me that the company is still handing off one baby born via surrogacy every day on average, at a cost of about $60,000. A representative of the agency initially told me that it was planning to open a clinic in Kazakhstan, to cater to the growing Asian market. In July, however, that country abruptly banned foreign surrogacy amid concerns about exploitation. " 

 

Xenotransplants will substitute for dialysis before they replace human kidney transplants

Transplants of organs from genetically modified pigs to humans is making progress, but pig organs haven't yet survived long enough to be a viable substitute for human organs.  Kidneys are a good experimental organ to work with, because when the pig organ fails, the patient can go back on dialysis (and continue to wait for a deceased-donor organ transplant).  But if pig organs can last long enough, they might replace dialysis.  The first pig-organ recipient to go straight to a human organ transplant has now been reported, in a press release accompanying the case report.  Below are both the press release and the case report.

Patient Who Received Pig Kidney Becomes First To Progress to Human Kidney Transplant
Study shows xenotransplantation can serve as a bridge for patients with end-stage kidney disease
By MASS GENERAL BRIGHAM COMMUNICATIONS September 3, 2026 

 Riella L, Borges T, Rosales I et al.
Porcine kidney xenotransplantation as a bridge to allotransplantation: a first-in-human study
The Lancet, 2026;  

"This case shows that porcine kidney xenotransplantation can provide prolonged renal support and be discontinued without clinically significant allosensitisation or zoonotic infection. Early cellular rejection resolved with treatment, whereas later graft failure was associated with microvascular injury progressing to thrombotic microangiopathy despite a negative donor-specific crossmatch, supporting the possibility that mechanisms beyond conventional antibody-mediated rejection contributed to late graft injury. Kidney xenotransplantation has the potential to provide prolonged dialysis-free support while also serving as a bridge to subsequent human allotransplantation." 

How to Get Away with Merger in a Dialysis Duopoly by T.G. Wollman

 Here's a paper featured by Microeconomic Insights, which shows that in the highly concentrated dialysis market, in which prices are mostly federally regulated, mergers reduce competition on quality.

 Thomas G. Wollmann: How to Get Away with Merger: Stealth Consolidation and Its Effects on US Dialysis 

"This paper studies premerger notification of US dialysis acquisitions from 1996 to 2017. Like many industries, dialysis has consolidated rapidly. During this period, thousands of facilities changed ownership, yet only half were reported to federal antitrust authorities. Unlike most industries, dialysis prices are mostly set by the government, so acquisitions of rival facilities reduce the incentive to compete on quality. Since patients are often already in poor health, preventing stealth consolidation could save lives.

The study combines data on market structure, antitrust enforcement, and patient health. I begin by describing patterns in the data. Next, I estimate a structural model of dialysis competition, enforcement, and agency costs. Finally, I use the estimates to predict what would have happened had all dialysis mergers proposed during the study period been reportable.

Three main findings emerge.

Premerger notification is critical to effective antitrust enforcement. All else equal, exemption reduces the likelihood of enforcement by about 90%.
Exempt acquisitions that concentrate ownership degrade quality, as evidenced by higher postmerger hospitalization and mortality rates.
The benefits of expanding premerger notification exceed the costs by orders of magnitude. This reflects the deterrence effect of antitrust enforcement (i.e., rivals won’t try to merge if they know their deal will be blocked) as well as the efficiency of the Federal Trade Commission (FTC), which polices billions of dollars of dialysis transactions with very few resources."