Maitreesh Ghatak
Posted online: Nov 16, 2009 at 0449 hrs
Let us assume for the purposes of our discussion that surgical procedures do not entail much risk. Would it be alright then to legalise the kidney trade? To answer this question as well as understand land transactions better, consider the example of heart transplants. Medical technology has made them possible, but the replaced heart comes from the body of a just-deceased person who had pledged beforehand to posthumously donate the organ. Should trading in human hearts be legalised, assuming that healthcare standards are high and there is no use of force or coercion? It is one thing if a dying man allows, in exchange for an agreed-upon sum, his heart to be taken out after his death and given to another person. But what if a healthy but impoverished individual, of his own free will, agrees to be killed and have his heart extracted for transplantation so that the money from the sale can help his family? No legal system in the world would find this acceptable, and with good reason.
It is well known that trading in hair, blood, sperm and eggs is legal in most countries, primarily because the human body can naturally replenish these. This is not the case with the heart and the kidneys, though the body can function quite well with one kidney instead of two. So, in thinking about whether to legalise kidney trade—or, for that matter any other trade that poses serious health risks on the participants—our judgement depends on the extent of these risks. Even the most aggressive advocate of free markets would agree that somewhere between the hair, where the risk is zero, and the heart, where death is certain, there needs to be a line demarcating the limits of the right to buy and sell.
In countries where government regulation is lax and healthcare for the masses is not up to the mark, this line needs to be drawn more conservatively. However, it would be naïve to think that imposing a legal ban puts an end to a troubling practice. There is a thriving black market for kidneys in India, and like all such markets, the biggest gain from it goes to the middlemen. Their presence ensures that sellers get only a fraction of the price paid by the buyers, and the latter are often duped too. And since everything happens outside the ambit of the law, corrupt doctors flout healthcare norms at will. Stories of organ rackets and scams abound in our newspapers. Many feel that legalising the transaction and imposing regulations on the organ market will help matters. While Iran is hardly the best example of a free market economy, it was motivated by similar sentiments in legalising the kidney trade in 1988. As a result, it is the only country where the demand for human kidneys is met with adequate supply.
It must be mentioned that in Iran, kidneys are not bought and sold in the open market, but only within a network created by the government and charitable medical institutions. But as noted earlier, the surgical removal of the organ has been problematic in Iran, and many sellers have ended up regretting their decision. Therefore, one feels somewhat hesitant to laud the fact that in this market demand is being met with supply.
Where a black market exists, such as India, potential sellers are deterred by the fear of being exploited by middlemen, of health risks, and of getting caught. Consequently, supply is always less than demand. Legalising the transaction could potentially reduce malpractices and health risks and ensure a better price to the seller. This is likely to push up the supply considerably in poor countries. However, increased supply will reduce the price. More importantly, unless the poor are provided adequate legal and medical safeguards, now a much larger segment of the population would be exposed to exploitation and health risks. As a result, it is not clear that legalising the sale of kidneys would lead to an increase in overall welfare compared to the earlier situation where a much smaller section of the population was involved in such transactions.
What about donations? The transaction is the same as in sales, with the same health risks and consequences. The difference is that one of the transactions is commercial, while the other is voluntary. There are no financial transactions involved in donations, and this automatically minimises the problems of quality control and malpractice. Health-related risks are similar for both, but the presence of middlemen and traders increases these risks considerably in the case of commercial transactions relative to donations. So, the arguments against legalisation mentioned earlier remain.
But society does have to pay a price for this kind of regulation. The biggest one in this context is the high probability of mismatch between donor and receiver organs. It is possible to start a system of exchange between all donors and receivers. The recent amendments to India’s 15 year law on organ transplants aim to facilitate this. But it is not difficult to gauge the limitations of such a system. The monetary system, after all, was invented because the barter system is subject to the problems of double coincidence of wants and coordination.
The recent amendments also aim to make it easier for the organ to be sourced from just-deceased or brain-dead individuals. In India about 1,00,000 people suffer from renal failure every year and about 80,000 people die of accidents. This suggests cadaveric donations could be an important source of organs. This is not as easy as it sounds, because donor and receiver kidneys need to match, and also, delays can make the organ unfit for transplants. In addition, there are social norms that go against putting a dead man under the scalpel.
In some countries of continental Europe, cadaveric organ procurement is based on the principle of presumed consent as opposed to informed consent as in the US and the UK. Under presumed consent, a deceased individual is classified as a potential donor unless he or she explicitly opts out before death.
Under informed consent, this is the case only if they volunteer, i.e., opt-in. Evidence provided by economists Abadie and Gay (2006)* suggests that the former increases availability significantly (see figure). Given the salience of the anti-legalisation arguments in countries like India, this seems to be a worthwhile direction to explore.
*A Abadie and S Gay (2006): “The impact of presumed consent legislation on cadaveric organ donation: A cross-country study”, Journal of Health Economics, 2006.
Concluded
The author is professor of economics at the London School of Economics