Supply And Demand 2


Supply And Demand 2 Essay, Research Paper

Recent medical advances have greatly enhanced the ability to successfully transplant organs and tissue. Forty-five years ago the first successful kidney transplant was performed in the United States, followed twenty years later by the first heart transplant. Statistics from the United Network for Organ Sharing (ONOS) indicate that in 1998 a total of 20,961 transplants were performed in the United States. Although the number of transplants has risen sharply in recent years, the demand for organs far outweighs the supply. To date, more than 65,000 people are on the national organ transplant waiting list and about 4,000 of them will die this year- about 11 every day- while waiting for a chance to extend their life through organ donation (Yoakam 1). This figure, when looked at from an economic standpoint, exemplifies a case of supply and demand between organ donors and patients with a diseased organ . Just as there is a supply and demand in any given market, there are also complementary and substitute goods. Who decides who gets transplants and who doesn t? This question implies that the organ market also needs to have various, effective allocation mechanisms. The organ market has complementary and substitute goods and can use various effective allocation mechanisms.

A person that receives an organ transplant almost always requires several complementary goods. One obvious good is the medical care received for the actual transplant and for follow-up doctor s visits. For most people who undergo an organ or tissue transplant the quality of their life and general overall health improves following the transplant. Persons who receive a transplant are frequently required to take a series of medications that suppress their immune system and prevent their body from rejecting the newly acquired organ. They often will need to undergo frequent medical visits and testing to monitor the transplanted organ. At times, the organ transplant will be unsuccessful and the organ may need to be removed. These people will be placed back on the waiting list for another organ (Yoakam). Two more goods are the medication to prevent rejection and (assuming the patient has insurance) payments made by the patient s insurance company for the patient s care. The donor s family is not responsible for the costs incurred through organ donation. The recipient, most times through their insurance carrier or Medicare pays for all of the costs related to the donation of organs and tissue. If the price of organs increases (whether due to an increase in demand or decrease in supply) the demand for the complementary good will decrease.

The converse of a complementary good is a substitute good. In the organ market, a substitute good really depends on what organ is being considered. People with diseased livers [are] particularly at risk because there is no medical alternative to transplantation for keeping a patient alive. The only two obvious substitute goods for a liver transplant would be extensive medical care and pain medications. On the other hand, someone with diseased kidneys has more options. One obvious option would be dialysis. But, when looked at as a whole, the organ market does have substitute goods. If the price of organs increases (whether due to an increase in demand or decrease in supply) the demand for the substitute good will increase.

Since the National Organ Transplant Act of 1984 prevents a monetary price from being placed on a donated organ, effective allocation mechanisms must be utilized. Allocation mechanisms must be accessed because the shortage of supply compared to the demand. In any market, allocation mechanisms rely on many factors but some include friendships, under the table payments, predicted profit, and personal biases.

In the organ market, several allocation mechanisms come to mind. There is always the possibility that a particular patient has a family member or friend that is in the organ transplantation profession, and/or the family of the patient is able to pay-off someone in charge of the distribution of organs. In reality, these two mechanisms are frowned upon for their lack of morality. One real possibility for an allocation mechanism is to make a waiting list on a first-come first-served basis. This method would only be for those who, in a panel of doctors professional opinions, had a chance to survive after the transplant. In other words, those dying with cancer along with a diseased organ would not be on the list. During the week of April 14, 2000, National Oragan and Tissue Donor Awareness Week, the President of the United States gave a proclomation. In this he stated, To address this critical and growing need, Vice President Gore and Secretary of Health and Human Services Shalala launched the National Organ and Tissue Donation Initiative in December of 1997. This public-private partnership was designed to raise awareness of the success of organ and tissue transplanta-tion and to educate our citizens about the urgent need for increased donation. Working with partners such as health care organiza-tions, estate planning attorneys, faith communities, educational organizations, the media, minority organizations, and business leaders, the Initiative is reaching out to Americans of all ages, backgrounds, and races, asking them to consider donation. In its first year alone, the Initiative made a measurable impact, as organ donation increased by 5.6 percent.

Although morals can play a part in the organ market, economic principles are definitely present. All of the aforementioned material is based on ceteris paribus. Complementary and substitute goods are associated with the organ market. These goods, although varying with different organs, are affected by the price of organs just like any other market. Since there is a shortage of supply compared to the demand, allocation mechanisms are necessary. Some of these mechanisms can be morally bound. Since a person s life is on the line in this market, any dead-weight loss at all is a serious matter. One can only hope this market is more concerned for life than it is for economic benefits.

Works Cited

Yoakam, Diane M. Organ Donation: The Gift of Life. 1999.

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