One of the commenters asks:

Finally, any guess as to how many of those healthy organs donated benevolently will not be available when the pricing game starts? Believe it or not, everyone and their descendents is NOT motivated by money. Look at how many community women stopped volunteering -- the work that truly built American character before the market-inclined came into the game -- once there was some expectation people could be paid for such services. Sure you'll pick up some donors in it for the money; how many of the "volunteers" -- in it for the end result, not the pay -- will you lose?

I had a section in an earlier draft addressing this argument, but I had to cut it for space reasons (though I included a little bit of it in other places). Here's what I said:

Some have also hypothesized a somewhat different altruism effect: that offering money for organs might alienate donors who would give the organs for free, and might therefore decrease (or not substantially increase) the aggregate donor supply. One can imagine some such mechanisms: If some people believe (whether rightly or wrongly) that an organ market is immoral or disgusting, they may refuse to participate. If some people start thinking of the transaction in financial terms, they may conclude that $30,000 is too low a price for parts of their bodies, even if they would have donated the body parts for free.

Likewise, some people might be turned off from the loss of the emotional benefit that accompanies a pure selfless act. Or some people might donate organs under the current system because they seek the emotional reward that comes from doing something that can only be done by the charitably minded. Once organ provision becomes the sort of thing that is routinely done for money, they might no longer be interested in doing it.

Yet while one can imagine such reactions, my sense is that they’d be quite rare. To begin with, only about 1.5% of all U.S. living donor transplants -- in 2005, 89 transplants in total -- are purely unrelated anonymous donations. Even if all these unrelated anonymous donors become alienated by the prospect that others are being compensated for providing organs, and aren’t mollified by the prospect of refusing compensation or donating the compensation to their favorite charity, this will be a very small loss to the organ pool. The remaining 98.5% are either donations to relatives, targeted donations (presumably mostly to acquaintances), or “paired exchange” donations in which the recipient’s relative or acquaintance provides an organ in exchange to the donor’s relative or acquaintance. These donors, I suspect, will care primarily about the welfare of the transplant beneficiary, and won’t refuse to donate just because compensation is offered. The cadaveric organs do often go to strangers. But how likely is it that a next-of-kin who would be willing to donate the decedent’s organs under a pure donation system would instead refuse when offered money (even given the option of declining the money, or sending it to his favorite charity)?

On the other hand, the opposite reaction -- a financial incentive doing what financial incentives usually do, which is stimulated the rewarded conduct -- should, I suspect, sway quite a few people. We see some evidence of this in the supply of eggs to infertile couples: In America, where women routinely get $5000 to $15,000 for such eggs, the eggs are generally available; in England, where the compensation is capped at £250, there is a years-long waiting list; in Australia, where payment for eggs is banned, there is a five-year-long list. We also see plenty of evidence of this in our daily experience with the overwhelming majority of other goods and services, where offering money will get you much better results than asking for charity.

Moreover, the offer of money may easily be presented in ways that harness charitable people’s charitable attitudes. Providing your (or your recently deceased relative’s) kidney for money, after all, saves a person’s life just as much as donating the kidney would; and then, if you have strong charitable impulses, you can just take that money and give it to your church, or your favorite charity.

The recipient is no worse off because you took the money. (Under an organ market system, the cost of the organ would surely be paid by private or government insurance, just as the much greater cost of the other inputs into the transplant -- doctor time, hospital space, pharmaceuticals and surgical supplies -- is now paid.) And if you are charitably minded, you can just take the money and give it to your church, or your favorite charity, or if you prefer some fund that will support organ transplants for the poor. You get to feel good about two things, the saving of a life and the donation of the proceeds, rather than just one.

What’s more, many genuinely altruistic people understandably feel that their charity should begin at home. A father’s death in an accident, which makes the organ donation possible, might at the same time strip away his wife’s and children’s main source of financial support. Getting money for the organs and using it for the children’s benefit will likely seem far more appealing -- even if the mother is generally charitably inclined -- than just giving the organs away.

This leaves one sort of person who might still be turned off, despite the option of declining payment or routing the payment to his favorite cause: someone who is deeply attached to the concept of doing the sort of thing that cannot be done for compensation. Note that this person isn’t the hyper-altruist who just wants to provide an organ to save a stranger’s life; he can still do that if he gets paid. Nor is it the hyper-altruist who just wants to give the organ free; he can still do that by forgoing compensation. Rather, it’s someone who won’t want to save the stranger’s life if such lifesaving is also done by others for compensation.

Yet how common are such people likely to be, compared to those who will see an offer of payment as an incentive? Consider a thought experiment: Imagine a requirement that doctors who do organ transplants do them for free, or not at all. Do we expect that such a requirement would on balance increase the number of doctors willing to perform such operations, since some doctors will be thrilled to do something that can only be done by the charitably minded? Would we say, “Sure, some doctors won’t want to invest their time and effort with no compensation, but think of how many more doctors would want to perform such a public service”? Or would we expect that counting on a combination of incentives and conventional altruism (in which some doctors may contribute their time and effort while forgoing compensation ) is a much surer bet than counting on pure altruism alone?