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Of course we should allow kidney sales

Of course we should allow kidney sales

By Jason Brennan1

Drawing from Markets without Limits, I point out that most opposition to organ sales is about the how, not the what. Opponents complain about contingent features that could be removed or regulated away.

But markets in kidneys are illegal. The government sets the legal price of organs at $0, far below the implicit equilibrium market price. Thus, an economist might say: of course there is a shortage, whenever the legal price of a good is set below the equilibrium price, the quantity demanded will exceed the quantity supplied.

Many philosophers and economists thus think that markets in organs will eliminate the shortage. You aren’t kind enough to give away your extra kidney to a stranger, but you might do it for $100,000. Defenders of organ sales believe it will save hundreds of thousands of lives annually and will help make the poor richer.

Making kidney markets illegal is quite literally killing people.

Many people think that markets in kidneys would have certain undesirable or exploitative features, but these problems can be overcome by designing and/or regulating the market appropriately.

Consider this: some object that if markets in kidneys were legal, then the price of a kidney would be so high that only the rich could afford it. But, in parallel, some poor people can’t afford food. We don’t as a result forbid markets in food.

Instead, we subsidize the poor by issuing food stamps. We could issue means-tested kidneys stamps as well. Further, on a free market in kidneys, the price would likely be much lower than it is on the current black market.

Others object that the poor would be exploited by the rich. Even if so, this at best shows not that markets in kidneys should be forbidden, but that only people who are sufficiently rich — for instance, who make over $60,000 a year — should be allowed to sell kidneys.

money-for-kidney-1Others object that people will rush to sell kidneys without a full understanding of the risks involved. But, again, at best this shows we should require would-be kidney sellers to be licensed. Before being allowed to sell, they must pass a test, akin to a driver’s license exam, showing they understand the costs and benefits.

In the end, some people feel that selling kidneys is just plain wrong, because it somehow violates human dignity or the integrity of the body. But this kind of disgust at kidney markets is quite literally killing people. There is no wisdom in repugnance.

Many things we now regard as normal or the hallmarks of responsibility — such as life insurance, anesthesia, or being willing to work for a wage — were once seen as undignified, or disgusting, or “commodifying life.” People’s lives are at stake here. It’s time to grow up and get over our primitive aversion to kidney markets.

Now, I myself prefer a free market in organ sales rather than a heavily regulated one. But that’s a secondary point. The question of whether we should have markets in kidneys is not the same as whether we should have unregulated free markets without governmental social insurance. You can be a social democrat and love kidney markets, or a libertarian and hate them.

Journalist Pedro García Otero offers a counterargument that is, I think, not persuasive:

From a recipient’s perspective, how much would a kidney be worth if he or she were dying? Priceless, no doubt. What about from the donor’s perspective? No sale would ever be voluntary. It would always be motivated, or more likely coerced, by desperate economic circumstances. This makes way for corruption.

To be frank, I’m not really sure what he’s getting at. Out of context, this passage is more clear than in context.

But one idea sort of hinted at here is that perhaps the market would be highly exploitative because buyers would be desperate and sellers would not be. People on the Left, and sometimes even on the Right, trot out this kind of argument. But it rests on a mistake.

Way back in 1817, David Ricardo asked us to consider a situation like this. Suppose Bob is desperate to rent land from a landowner. Suppose there are 50 landowners, none of whom is desperate to rent out their land, but each of whom can profit from doing so. You might think the landowners would give Bob a bad deal, since Bob is desperate and they are not. But, Ricardo points out, you’ve got things backwards. In this case, the landowners have to compete amongst themselves. Each can profit by outbidding the others, but offering Bob a better and better deal. Bob will actually capture almost all the bargaining space for himself. So, Ricardo reminds us, bargaining power isn’t just about desperation vs. indifference. Rather, it’s about competition. Bob has no competition (he’s a monopsony buyer of land rent) while the owners have lots of competition.

What happens, instead, if there is lots of competition on both sides? Well, then we get a normal competitive market.

People, especially those on the Left, often lazily argue against certain markets by asserting, without good evidence, that the market in question will be (behave as if it were) monopsonistic or monopolistic, and thus allow some to exploit others. (I’m looking at you, Marx. Read some real econ and take a shower while you’re at it.) Usually they have no evidence for this claim. But even in the uncommon cases where they do identify such monopsonies or monopolies, the solution isn’t obviously to forbid a market, but to do things to break up the monopsony or monopoly.

The article first appeared on Bleeding Heart Libertarian.

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