Market Failure in Kidney Exchange / Nikhil Agarwal, Itai Ashlagi, Eduardo Azevedo, Clayton R. Featherstone, Ömer Karaduman.

Format:

Book

Author/Creator:

Agarwal, Nikhil.

Contributor:

National Bureau of Economic Research.

Ashlagi, Itai.

Azevedo, Eduardo.

Featherstone, Clayton R.

Karaduman, Ömer.

Series:

Working Paper Series (National Bureau of Economic Research) no. w24775.

NBER working paper series no. w24775

Language:

English

Physical Description:

1 online resource: illustrations (black and white);

Place of Publication:

Cambridge, Mass. National Bureau of Economic Research 2018.

Summary:

We show that kidney exchange markets suffer from market failures whose remedy could increase transplants by 30%-63%. First, we document that the market is fragmented and inefficient: most transplants are arranged by hospitals instead of national platforms. Second, we propose a model to show two sources of inefficiency: hospitals only partly internalize their patients' benefits from exchange, and current platforms suboptimally reward hospitals for submitting patients and donors. Third, we calibrate a production function and show that individual hospitals operate below efficient scale. Eliminating this inefficiency requires either a mandate or a combination of new mechanisms and reimbursement reforms.

Notes:

Print version record

June 2018.