The Flesh Trade

We have a new “Freakonomics” column out in the current New York Times Magazine. (For a year, we wrote the column once a month), but we’ve just scaled back to once every two months.) This one is about organ transplants — specifically, how the huge success of transplantation in recent decades has created a surge in demand for donated organs, which are in very short supply, and how a variety of people (economists in particular) propose this problem be addressed. As usual, we’ve put up a page elsewhere on this website with various research documents and links. We also blogged about the subject here several weeks ago. Comments welcome.


Not having read the article, but when you mention unmet demand with limited supply, could this be from essentially a fixed price in the market? Simple supply and demand curves show that fixing a price below where the curves meet, a shortage will appear. Since, the price one can sell one's organs is zero, we have a shortage. Could'nt this problem be solved by allowing an open market for organs?


>> Could'nt this problem be solved by allowing an open market for organs?

Besides the moral issues, you then create a market which is open to abuse. Imagine the doctors asking you if you want to disconnect Aunt Sally now, since the value of her organs has gone up this month. Imagine the kind of market as in India where Doctors go into ghettos and offer money for organs (from living people)...


If someone, such as yourself, finds it morally wrong, then you don't have to participate in the market by either buying or selling organs. How about we let someone who has been waiting for months for a kidney (many people can live with 1) decide if it is moral. Why should'nt someone because they are poor or are in a ghetto be able to make such a decision? What are you implying?


The opposition to payment for organs usually is expressed as fuzzy moral arguments which, in my mind, reflect a misunderstanding of markets and misplaced morals. Of course a market for organs is a good thing, in the same way that a market for food - another life necessity - is a good thing.

However, there is a legitimate argument to the contrary. It's possible that if a low price is set for organs, the supply could be reduced. I'm thinking of an analogy to the Haifa day care center result. (Discussed in the D&L's book, in which a fine for late pickup resulted in MORE late pickups.) The argument is that an economic incentive can displace a moral incentive.

I don't believe that this would occur in the organ market - but it might. I think that this is what some of the organ market opponents really mean when they give their muddled ethical arguments.


Markets are subject to abuse when people have unequal baragining power. This is another form of information asymmetry. The poor people who sell their organs are likely not well protected in terms of information (consequences of selling an organ for example) and do not have much bargaining power, as these are not "open" markets. A truly open market at least would make pricing clearer. But, as is seen in much real estate lending abuse (and other lending abuse), information asymmetry also can fail open markets. There are plenty who will prey on the less informed, as I am sure you well know. I suppose, like adoption, this would settle after some number of years due to regulations being created after enough abuses are made public.

The other side of this coin is that making a market for this is likely to severly reduce organ supplies. I think many, including myself, would find that a sold organ has moved donation from a noble cause to a commercial one. I would likely destroy my organ donation form if this were to happen. I would like to believe that offering my organs upon my death is not just another transaction, like selling a car. Perhaps others would feel different, but I think this is not like selling food at all. It is not even like the French house sales-on-death thing (where someone pays an old person money now, betting they will die soon).



In the book, Why Not?, they recommended that instead of having to sign the back of our dirver's licenses in order to donate organs, it simply be changed to a requirement that we have to sign it if we DON'T want to become organ donors. This would massively increase organ supply without denying anyone's rights.


I see. That sounds like fancy talk for, Indians are too stupid to make such decisions for themselves. God forbid they try to improve their conditions by making money. Plus, the reduced supply thing makes absolutely no sense to me. Simple supply & demand tells you without price fixing, the supply line will rise to meet demand intersecting with a market price. Sure, some dumb Indians may get screwed in the beginning, but as others come in to make offers, they will have to offer an advantage over the rip off organ people you believe will be covering the country. As far as nobility, I think it is safe to say that more people can be motivated by money than nobility, or we wouldnt have the shortage in the first place. Now, if you took any state organ program, and added an incentive where your estate or surviving spouse will get $5000 if you donate your organs, I am sure you will see membership rise. In the end, you will see more people receiving the organs they desparately need. Isn't that the morally correct thing to do?



Think about the increase in health care cost, people lives longer and longer after retirement. Should we allow the rich people more ways to delay natural death by unfair trading out of the expenses of the poor, the african's fresh heart may be harvested at a young age rather to let them live his whole life raising cattles. There are hidden social costs to consider, would Buffet stop his donation and retirement after he gets himself new body parts from walmart, would US begin organ transplant subisdy on top of farms subsidy. Once they say there are two certain things in life: tax and death. Tax is defintely unfair, leave death alone. In Mummies the movie, the bad guy dissolves and absorbs the victims body to provide ingredients to regenerate his own to stay immortal, are you prepare to trade your kidney with the Japaneses to get a new Honda. Buddhism defines life as a cycle of four parts: Birth, Age, Sick and Death. Economists, don't mess with the cycle.



I sometimes see advertisments appealing for blood donations because "one day you might need a blood transfusion."

Perhaps if more people realised the increase in the quality of life many people recieve from donated organs, there would be a greater supply.

About six months ago my younger brother died aged fourteen, and the family was asked if we would like to donate his organs. To be honest we knew absoluteley nothing about the process, but after recieving some heplful information from the donor agency, we decided to donate. Money had nothing to do with it.

Through all the grief it was nice to know that the donation had given at least five people another chance at life.

I think education and awareness are much more important than opening up the market.


No one has yet mentioned the enormous loss of fresh organs by cases of suicide and terminal cases.instead of letting the hopeless suffer , they can be better used to help the human life cycle by donating their organs.i'm sure that a guy with terminal heart disease would have no complications in donating his eyes , do you?

of course over time , the organ market will fall - i'm guessing due to development to cheaper artificial substitutes and picky recipients - perhaps in the future an ailing british millionaire would prefer an artificial kidney instead of an actual one from a cas-strapped cowherd in africa.......

P.S - what is this issue you have about indians? you see , for an indian farmer who is neck deep in loans , and is on the verge of suicide - organ donation may be a's a nation of a billion people dammit - you can't make them ALL happy!
as an indian - this is what i believe.



First of all, a market where the supplier has exactly one of a commodity item is not one which enpowers the supplier. It is sort of like the give a man a fish or teach him to fish saying. The Indian (as you state it) who gives up an organ gets a one-time payment (probably heavily devalued after middlemen take their cut) and has little bargaining power to get the most for it (he/she requires professionals to extract the organ and broker it, etc). After that, no more. Further, that person risks health problems down the road with no one to pay for that.

The comment that the market will raise the price after more supply makes no sense. If lots of these poor Indians are being offered some money (and are desperate), the market forces will lower the price. It will settle around the desperation level (why we have usury laws) since the buyers will be pushing the prices lower as supply exceeds demand.

As to the lowering supply, my point was that with strict regulations (in this Country) that are likely and with the nobility taken away, I think you will get less signing up. That does not mean the world supply will go down of course; if we "harvest" organs from India or other places, then the available market will go way up. The richer countries will be paying a higher price for quality organs and taking them from the poorer countries (as is true of most such markets). But, like most items exported this way, the end point supplier will not be the real benefciary of this money - the middlemen will be. Maybe there will be a "Fair Trade" organ line? ;-)

As another commenter said, the 'Why Not?' suggestion of an opt-out approach is a much quicker and easier one. I suspect many do not bother to sign up for the organ donation, but are not against it.



There are advances that will soon allow scientists to grow organs. Skin, cartilage, and corneas are already being grown and blood vessels are being developed. Organs are much more difficult, but progress is being made.

Probably allowing more freedom in stem cell research would further efforts here.

Here's a link


Yes, the long term goal has to be organs that are grown in the lab (or in your body). The current method is much like having to hunt your own food vs. sustained agriculture. But, while we are having to hunt our own organs, the question is how do we get supply to meet demand?


In terms of economics, yes, it would make sense to compensate people for donating organs. But small compensation would make no difference because that's in the price-inelastic portion of the supply curve. Anyone who would do it for a little money would do it for free. We're talking a lot of money.

I think when people see that, they get scared that we will reach a point were only the rich can afford organs and perfectly innocent people have no chance at surviving their injury or disease simply because they happen to be poor. Surely it would be repugnant IF it happened. However as long as no dishonest middlemen are involved I believe the theory is that a family donor who is not a match for his living recipient would instead sell the organ and buy one that does match.


The article only discusses incentives for buyer and seller, both of whom are willing participants in the transactions. However, once organs become marketable commodities, one can also envision forced sale of organs to benefit a third party. Examples: forced organ sale to pay off debt and the extension of the imminent domain concept to "internal commodities". And I'm not going into scarier incentives, like profit-motivated legal execusions or their timing. Who would create the legal firewall to prevent such cases?

Dave Undis

Levitt and Dubner ask: "if you can't get someone to give an organ out of altruism, and you can't pay him either, what do you do?" The answer is to find a legal way to trade.

LifeSharers offers a very compelling trade -- you agree to donate your organs when you die, and in return you increase your chances of getting an organ if you ever need one to live.

This trade is available to anyone in the United States at or by calling 1-888-ORGAN88.

Ken D.

By the way, pkimelma, that "French house sales-on-death thing (where someone pays an old person money now, betting they will die soon)" is as Anglo-American as the lawyer joke. It is called selling a remainder interest (the flip side of a life estate), and it is a feature of most of the increasingly popular "reverse mortgage" arrangements.


Hi Ken. I agree that reverse mortgages have some of this component, but they came much later (the French system comes from early 1900s) and they are not a bet. That is, a RM is simply a deal where the old person gets paid monthly payouts by borrowing against the value of the house. When they die, the sale proceeds are split so that the RM company gets its share and the rest (if any) goes to the estate. The French model pays until the die, including going well underwater (paying more than value of the house). More importantly, the French model is person-to-person. It is not some finance company usually, but couples who want to buy their own retirement house or summer house on the cheap. They are betting on the people dying early, but sometimes get caught out. It is more of a Freakonomics kind of deal than a normal reverse mortgage.


I've spoken with a lot of people are are uncomfortable with the idea of opt-out organ donation. It can be a bit creepy if other people get automatic claim to your body parts if you die. It's the flip problem of what we have now: instead of missing out on people who would donate but didn't bother to opt in, you end up taking the organs of someone who *didn't* want to give but failed to opt out.

Why not just require people to state one way or the other whether they would like to donate organs when they die? Attach it to driver's license renewal; you can't renew until you've indicated whether or not you'll give. Most people, I think, wouldn't mind donating, but don't bother getting a card. It's not opt-out or opt-in, it's simply 'opt'.


I think that this is what is usually meant by opt-out for organ donation. Your driver's license application and renewal has a yes/no box for organ donation. This is easy enough. The current method requires you to fill out an extra form. A pure opt-out would require you to explicitly check a "I do not want to donate". The problem with the latter is that there is no way to tell if you failed to see the box or chose not to fill it in. A yes/no being blank means you missed it and they can then force you to make a choice. So, I agree.