Business Life: Psst! Want to buy a kidney?

28th February, 2008

First published in Business  Life magazine, September 2008

Basic economics says that when supply can’t keep up with demand, raising the price will solve the problem. It sounds sensible – but what if we’re talking about a market for live human organs? Economic logic doesn’t seem to be much use, because the mere idea that patients might pay others to donate organs is offensive to most people.
Our attitude to an organ market might change eventually; attitudes sometimes do. Life insurance, for example, was considered ghoulish until about a hundred years ago, because it is a bet about when you’re going to die. Now it is not only acceptable, but regarded as something any family breadwinner should do.
But whatever some economists might wish, there is no prospect of a legal market for live kidney donations any time soon. One economist, Al Roth of Harvard, has therefore taken a more pragmatic approach to the problem. He realised that there is an untapped resource: many people on the waiting list for a kidney have a friend or relative willing to make the donation, but unable to do so because the pair are biologically incompatible.
Professor Roth realised that while it is not socially acceptable to offer money for a kidney, it is acceptable to offer a kidney for another kidney. And so he looked for ways to match pairs of donations, with the aim of making the transplants more compatible. My friend donates to you; your friend donates to me, and both transplant operations are more likely to be successful.
Such “paired kidney donation” is an example of a “matching market”, and Roth is the world’s leading expert on matching markets. He has spent much of his career designing them; for instance, matching student doctors with a favourite list of training hospitals with training hospitals, which have a favourite list of students. That turns out to be a simple problem – until you realise that many student doctors are in relationships with other student doctors, and the system will be rejected if it splits up these couples.
Matching markets for kidneys can also be technically demanding. For example, an altruistic donor who declares herself willing to donate to anyone can trigger a little avalanche of transplants on a kidney exchange – but only if the exchange is well-designed.
Al Roth, with fellow economists Tayfun Sonmez and Utku Unver, designed a kidney exchange programme with the help of surgeons in New England. And it’s working: over 30 transplants had taken place by the summer of 2008. The UK has now changed its own laws to permit paired donations, and the first transplant took place late in 2007. Economists are saving lives – sounds strange, doesn’t it?

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