Economics Behind Blood Donation

Economics Economics Questions
1

Blood donation is a big deal at the company I work for. Some of the people I work with get really involved in planning committees and what not. Mainly I think this is because its a way to get out of doing actual work. But I digress. They do anger me though when I get grilled on why I don’t want to freely give my blood away. Somehow, arguments like ‘Why don’t they just pay me for it?’ come off as childish or greedy (in their eyes, not mine). That used to get to me, but now, I’m thinking differently.

Blood is one of the most important substances that my body makes on a regular basis. It takes time and resources to produce and its absolutely essential for my survival. Without it, I die, and without the proper time and inputs, it doesn’t get made.

So why on earth should I freely give away my blood? If there’s such a high demand for it, then how come there isn’t a market for buying and selling it? There’s markets for other necessities: food, clothing, shelter, gasoline, medicine. If we took it to an extreme, we could easily say that farmers should donate their produce, clothing companies their clothes, construction companies their nice new houses, etc.

Between people and blood banks, there is no traditional market, at least not in the sense that value is exchanged for value on a rational basis. The basis relied upon is some sense of civic, or even human duty, goodwilll, etc. And I’ll bet dollars to dimes that blood banks don’t donate their collected blood to hospitals out of the same sense of “duty to humanity”. I know for a fact that hospitals don’t donate it to patients either. If I remember right, a pint goes for a couple hundred dollars. Additionally, employers offer tiny perks for the service. In the military, we used to get the day off. At this company, we get a cute little pin to where. I’d prefer getting compensated for the blood my body has to do double duty to make up for.

Anyone know why a normal “blood market” doesn’t exist. With all the fuss made over the scarcity of it, you would think someone would have said to hell with the good will, lets make some money off of it.

BTW, this is my first post.

2

I thought people could make some money donating blood back in the day.

Welcome. Strong entrance.

3

Searching for “get paid for blood donation” at google, gave me this:

Q: Why are some blood donors paid while others are not?
A: In the U.S., blood and blood components used for transfusion to patients must be donated by volunteer, unpaid donors. This is one way in which blood collectors can assure a safe blood supply. Paid blood donors can only donate plasma, and this plasma is then used by pharmaceutical companies to make drugs. This plasma goes through a great deal of processing to insure its safety. Blood for transfusion does not go through the same processing.

Source

There you have it. It’s illegal.

4

This argument seems like a non-sequitur. My statements are directed to the site and not to Zlatko.

One conclusion that can be drawn: ‘only people who are willing to volunteer their time and vitality have clean blood’. Another conclusion could be: ‘People who want money for their blood have tainted blood.’

I doubt that the first conclusion is even entertained in the industry. All volunteers go through a lengthy screening process.

So process it to ensure its safety. But seriously, are the visitors to that site supposed to believe that blood is not processed, screened, etc. and that the entire basis for the guarantee of its safety rests solely on the fact that a volunteer donated is (as opposed to a seller selling it)?

To be honest, volunteer blood donations sounds like a great racket. Consider the formula: convince millions of people that selling a scarce resource that they produce is unsafe and/or selfish, and that donating it freely is safe and a civic duty. Then, sell it for profit to hospitals.

It may be, but I am not aware of any laws like this.

5

I am a repeat blood donor. I have never been given straight dollar in hand, but there other incentives. I’ve gotten half off on hockey games, gas cards, free tickets to carnivals, free lunch or dinners at local restaurants. I’ve saved hundreds on leisure activities thanks to giving blood. Ive made good with the free mason whom usually run the drives.

I have A negative blood, so they constantly bother me. They always tell me there is a shortage, blah blah. I believe it goes to a good cause and I want to pass my dad in the 2 gallon club.

6

I used to donate blood all the time. I was aware of the fact that it was a valuable resource, but I was willing to give it away because I thought I could help someone in need. There’s nothing wrong with voluntary charity, after all.

Still, I wouldn’t be surprised if the sale of whole blood were, in fact, illegal. The sale of body parts in general is, after all. Which is ridiculous. I have always thought the constant blood shortages could be alleviated if they would pay for blood as they do plasma - of which I’m now a regular donor.

At the plasma “donation” place they say the compensate you for your “time,” incidentally. This is clearly false - you get paid based on your weight class and get the same amount regardless of how long it takes. I guess actually coming out and saying they are buying bodily fluid would be taboo.

7

Now that I think of it, this might actually be hitting the nail on the head. Any laws governing the sale of blood (or body parts), might be reflective of societal norms, i.e., that its bad, or gross, etc. From this perspective, it makes sense. It does, however, become a double standard when a patient gets charged at a hospital for transfusions (and not in time, but by the pint).

Then again, making the entire chain, from donation to transfusion, free would probably be disastrous. With no indicators on the relative scarcity of blood, allocation of it wouldn’t be rational or efficient.

My thinking is that if an end-consumer is paying an intermediary for a scarce resource, the original producers should also get paid. I also think that a free market of blood would lead to safer, larger, and more efficiently collected yields with quicker delivery time to those in need. But I guess I’m just preaching to the choir here. [:)]

8

Exactly.

9

Just tell them that you’ve been to Europe for a while and you are not allowed to give blood! Dang, people should just mind their own business.

10

I’d love to see the topic of donated blood and organs explored more fully. I’m actually surprised it hasn’t been done (perhaps my Google-fu is just weak).

My guess is that if blood were sold, the price would be so low, due to poor people donating a lot, that it would be less ‘profitable’ for the Red Cross and similar organizations than the current model of getting people to donate blood, money, or both. Blood isn’t really that scarce of a resource, but by having people donate it instead of selling it, they’ve created an artificial scarcity which raises their profits.

11

May be if you consider this thought experiment, it might help straighten out your thoughts?

Say you are the lone person walking on a street late into the night. As you walk you came across this man grabbing his chest, clearly suffering a heart attack. If you don’t make a call and get him an ambulance, he will die.

Now, would you demand this guy to pay you for calling for an ambulance, before you make the call?

If he has no money on him will you walk on without doing anything?

Now substitute the cost of making this phonecall (call charges, the nuisance of making a call, etc) for your blood. For many people on matters related to life and death, they are willing to overlook the monetary value of things.

12

Agreed, and this is why I and many others donate blood. However, it seems clear that this mechanism doesn’t work well enough - after all, we’re constantly told about critical blood shortages. If there were a market for blood, and there were enough donors to meet the demand, then the price would be 0. If not, the price would rise - which would not prevent people who wish to do so from donating their blood. But isn’t it odd to see an enforced price of $0, and constantly to be told about a shortage? Isn’t there an obvious way to get rid of this shortage?

By the way, it isn’t exactly the same. While the need is the same, it is less immediate. In the heart attack case, it’s right in front of you. While rationally there is no difference, there is an emotional difference. People will make that phone call, but may not make the plan (it usually takes several hours) and keep up with it in the case of blood when the need is not staring them in the face.

13

There are some studies that show by paying people you practically turn them away from donating blood.

But you might not believe in intrinsic motivation etc…

There is a constant shortage of blood because blood don’t keep fresh forever. A regular supply of blood is vital red cells last only 35 days and platelets only five days. If nobody donates any blood for 5 days - then that’s it. And you need to have blood products on hand because people who need blood transfusion usually didn’t plan it. So part of the shortage is driven by logistic.

There are also considerations with regards to diseases. There is moral hazard / self selection problem. By offering to pay for blood, you attract people who are motivated to give blood for money. What kind of people give blood for money, you might ask? Could it be people who have nothing else to give? You also need an honourable type of person to give blood - e.g. detection of HIV viruses is not 100% (at least not until 90 days after a person has contracted it), they take a sample (a few ml) of blood to test for diseases etc., but what about the other 500-odd ml of blood that are actually used for transfusion? You need blood givers who aren’t willing to lie for the money offered. By providing no money you provide no incentives to lie about risky sexual behaviour / drug taking.

14

I don’t give blood either. I feel similar to the way you do, and I also hate needles.

15

lets try a more relevant thought experiment. Everything starts the same, lone person walking, heart attack in front of your eyes.

“I have a rare diease,” he gasps. “I can only live if you let me chew up and eat your little finger. Dont worry, its so cold out here you wont feel a thing.”

here’s another one:

“I have a rare disease.” he gasps. " I can only live if you let me eat up five hundred dollars I notice you have in your wallet."

"Will you repay me some day?’

“No. But I will repay someone else for your five hundred dollars. Don’t worry I’m not getting anything for free here.”

or putting it all together;

“I can only live if I chew up your little finger, then pay someone else unrelated to you five hundred dollars beacuse I ate your finger.”

“Will I get any of that money? After all. it’s my finger we are talking about.”

“You get nothing, you vampire.”

16

Ok. I don’t see how this wouldn’t be improved by having more donors.

I’m sorry, I’m not good at judging people by their financial situation, and deciding that people who have a few hours to spare for no money are better people than those who don’t. I’m really not good at this skill.

I find it odd to think that it’s likely that a few mls of blood will be free of some problem that the entire sample has. Maybe, but this has to be incredibly rare, especially if you test for antibodies rather than for pathogens themselves. Meanwhile, the motivation not to lie is simple. The person, by your assumption, wants money. Write him a post-dated check, and cancel it if you find the sample to be useless, then blacklist him.

17

It might be free to obtain blood, but the processing, testing, storage aren’t free. The money the sellers received aren’t just for the blood per se, but also that it is safe to use.

Say someone received a transfusion of a blood donor who didn’t know that they have hepatitis . This patient who received the transfusion lateron discovered that they became infected. The infected patient wouldn’t be going after the blood donor for compensation, they would be going after the hospital and the blood provider for compensation.

If people are selling blood directly to patients for transfusion, they blood givers would take out an insurance to insure themselves against causing medical problems to the receivers. Given that people are only supposed to give (supply) blood four times a year max, would such a market for blood giving insurance survive? In the words of Alvin E. Roth, would this market be “thick” enough?

18

Your solution only works if the medical tests are 100% works. Like I said before, there is a window period with regard to HIV tests. Even infected blood can sail through the HIV test and be transfused to people. Blood is only fresh for 35 days, HIV window period is 90 days, people can only give blood four times a year at max (three times a year is recommended).

If you use backdated cheque method, the first blood giving will have to be discarded. And you must be certain that since the first blood donation, the person hasn’t engaged in any risky sexual behaviour or had intravenous drug injection. So there are two solutions, have blood givers being locked up in solitary confinement with no possibility of interacting with other people. Or two, don’t give them incentives to lie.

19

I don’t see why. We presently draw some volume, using most of it for transfusion, and testing the rest before using it. So do the exact same thing, and along with the cookies, give them a check dated 5 days out.

So it would follow that you believe this to be a rational market outcome. So you have no need to have laws enforcing it. Correct?

20

With regard to

“I’m sorry, I’m not good at judging people by their financial situation, and deciding that people who have a few hours to spare for no money are better people than those who don’t. I’m really not good at this skill.”

You don’t want attract blood givers who give because they need money. People would lie for money, especially if they cannot obtain money via other forms, e.g. by engaging in employment. Give them no money and they don’t lie for it.