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An analysis of economic incentives to encourage organ donation: evidence from Chile

Author

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  • Marcela Parada-Contzen

    (Universidad de Concepción)

  • Felipe Vásquez-Lavín

    (Universidad del Desarrollo)

Abstract

We perform a cost–benefit analysis on the introduction of monetary incentives for living kidney donations by estimating the compensation that would make an individual indifferent between donating and not donating a kidney while alive using Chilean data. We find that monetary incentives of US$12,000 save US$38,000 to health care system per donor and up to US$169,871 when we consider the gains in quality of life of receiving an organ. As one allows the incentives to vary depending on the individual position on the wage distribution, the compensation ranges from US$4214 to US$83,953. Importantly, introducing payments to living donors payable by a third party helps patients who currently may not have access to necessary medical treatment. Therefore, exclusions in access for organs due to the monetary constraints can be prevented.

Suggested Citation

  • Marcela Parada-Contzen & Felipe Vásquez-Lavín, 2019. "An analysis of economic incentives to encourage organ donation: evidence from Chile," Latin American Economic Review, Springer;Centro de Investigaciòn y Docencia Económica (CIDE), vol. 28(1), pages 1-18, December.
    • Handle: RePEc:spr:laecrv:v:28:y:2019:i:1:d:10.1186_s40503-019-0068-2
    DOI: 10.1186/s40503-019-0068-2
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    References listed on IDEAS

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    Cited by:

    1. Karen Evelyn Hauge & Snorre Kverndokk & Andreas Lange, 2021. "Why People Oppose Trade Institutions - On Morality, Fairness and Risky Actions," CESifo Working Paper Series 9456, CESifo.

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    More about this item

    Keywords

    Organ donation; Compensations to living donors; Cost–benefit analysis;
    All these keywords.

    JEL classification:

    • I18 - Health, Education, and Welfare - - Health - - - Government Policy; Regulation; Public Health
    • K32 - Law and Economics - - Other Substantive Areas of Law - - - Energy, Environmental, Health, and Safety Law
    • D61 - Microeconomics - - Welfare Economics - - - Allocative Efficiency; Cost-Benefit Analysis

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