NCPA - National Center for Policy Analysis


November 30, 2006

Despite a chronic shortage of organs for transplant patients, many public intellectuals, including members of the Institute of Medicine's (IOM) organ donation panel, have rejected a method that has proven quite successful for medical schools: offering financial incentives, say David E. Harrington, the Himmelright Professor of Economics at Kenyon College in Ohio and Edward A. Sayre, an assistant professor of economics at Agnes Scott College in Georgia.

According to the IOM's argument:

  • No compensation (most commonly, covering funeral costs) should be allowed unless there is clear empirical evidence that it would increase the supply of transplant organs. 
  • In addition, they decry the idea of creating a pilot program to obtain the empirical information they require.
  • Overall, they say compensation would be perceived by organ donors as sullying their gift.  

But in reality, families of donors often proudly highlight their gifts in obituaries, despite their receiving the financial benefit.  Further, there is clear evidence that potential donors respond to financial incentives.   In states with stringent funeral regulations -- intended to keep out low-cost competitors -- where funeral prices are higher, one would expect donations to be higher. That is, in fact, what the data show:

  • The number of body donations in stringently regulated states is 7.6 bodies per thousand deaths and only 3.2 bodies per thousand in unregulated states.
  • Harrington and Sayre estimate that high funeral prices in the 38 states with stringent funeral regulations increase the number of donations by 8,400 bodies per year.

Surely, say Harrington and Sayre, if funeral service costs increase the donation rate of whole bodies to medical schools, compensation would increase the donation rate of transplant organs.

Source: David E. Harrington and Edward A. Sayre, "Buying Bodies, Stealing Organs?" Washington Post, November 28, 2006.

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