Kidney Analysis- Sans Article

The Market for Kidneys: An Economic Analysis As you have seen so far in this course, economics is the study of incentives and efficiency. We have applied economic reasoning to such diverse fields as the market for insulin and taxes on soda. However, we will now take our analysis of markets a step further and look at a controversial topic: the sale of human organs. According to the National Kidney Foundation1, approximately seventeen people die each day in the United States while waiting for a vital organ transplant; about 3,900 of those people are waiting for kidneys, the most in-demand of the organs. Because the sale of human organs is illegal in the United States and throughout much of the world, those who need organs must acquire them in two ways: from a matching donor, either voluntarily (such as a brother giving a kidney to his sister) or involuntarily (someone dies in an accident and has his/her organs donated). In both cases, however, there are complications in performing the surgeries, hoping the organ is a match, waiting for the transplant, making sure the kidney is healthy, etc. This is where economics is useful. We have people who need a product (in this case, kidneys), and we have people who might be willing to sell a product (their healthy kidneys). As such, we have a market for kidneys. And supply/demand analysis suggests that if it was legal for citizens to buy and sell kidneys, then the market equilibrium would ensure that many, if not all, of the people on the kidney transplant list would receive the organ they need to survive. Your task will be as follows. Using economic analysis and the New York Times Magazine article, you will answer the following question in a three to five page paper: Should the United States legalize the sale of kidneys on the grounds of economic efficiency? Some questions that your paper should answer: • What are property rights, and how far do they extend? Does a person “own” their body, and does that mean they should be allowed to do whatever they wish to it? • How would you describe the current system of allocating kidneys (i.e. what market structure does it most resemble)? • If the sale of kidneys was legalized, what would happen to the price, quantity, and allocative efficiency of kidneys? • What are possible long-run costs of kidney sales? Besides just the cost to the kidney buyer, are there societal costs as well? • What is your opinion on the matter? More details are provided on the reverse.

1 http://www.kidney.org/news/newsroom/fs_new/25factsorgdon&trans.cfm

A Note About the Length The three to five page length serves more as a recommendation than a requirement; if your paper is slightly longer or slightly shorter than this, it is fine. The key is the content. However, your instructor would find it stunning if you could put the quality of reasoning and analysis into a paper less than three pages. On the opposite hand, a paper that runs into the seven or eight page range seems excessive given the requirements for the assignment. Content Please remember that this is an economic analysis paper, so please do not insert political considerations into your reasoning. Remember, you are trying to prove to me using economics that kidneys sales are efficient or inefficient for society. The economic analysis should be rooted in material that we have discussed thus far in class. Your paper should demonstrate sound economic reasoning, and a high-quality paper should include at least one graph to analyze the market for kidneys, if not more than one. Graphs should be included in an appendix located at the end of the paper, and referenced in the body of the paper. Please note that the appendix is not counted as part of the page requirement. This is not a research paper per se, and so you are not expected or required to do any outside research. You should reference the article given in class and it should be accurately cited using APA format (intext citations). However, if you do use outside materials, then they must be included in the works cited page and cited accurately within the body of the paper. Grading Papers will be graded on a holistic scale in which the instructor will examine the paper's content, coherence, clarity, and grammar/mechanics. The following scale will be used to convert letter grades into a score for the gradebook: E DD D+ CC C+ BB B+ AA A+ 50

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Papers will be due on _______________________________. However, they will be returned to you with the initial grade from the scale above. You will then have one week to make corrections/revisions and resubmit for the opportunity to move your grade up to two levels (i.e. a C+ could jump as high as a B, an A- could jump to an A+, etc.). Revisions should be made directly (and neatly) on the original paper in blue or black ink, and it should be obvious what was corrected. Collaboration In the next several days, the instructor will create a blog entry about the paper. Students are encouraged to use the blog as a sounding board to ask questions, get ideas, and clarify some of their thoughts. Please note, however, that each student will be required to turn in their own paper, and that plagiarism is severely punished.