Organ Procurement Systems and the Possibility of a Market for Human Organs

Abstract

The shortage of transplantable organs is a pressing issue, especially in countries who outlaw market systems or enact altruistic donation systems. The failure of nonmarket systems in allocating enough organs to clear waiting lists, on which many die each day, suggests that a market system may provide a solution. This paper explores the literature surrounding organ and healthcare markets and policy. Then, using a partial equilibrium model, it creates and examines a theoretical model for an organ market in a country such as the United States. The results of a free market indicate that due to several positive externalities, government intervention via subsidy would be a tool that could help correct for market failures. Ultimately, the results and discussion demonstrate that without several key aspects of perfect competition, a market for human organs is not a feasible solution due to the potentially high costs of correcting for those market failures.