Dissertation Title: "The Economics of Organ Allocation"
Unlike most goods and services, organs are distributed according to an administratively-determined point formula. This formula must balance competing goals, including the need to minimize organ wastage, the maximization of human life, and the equitable distribution of resources. This dissertation examines the current system for allocating livers in light of these goals. When an organ becomes available, wait-listed patients are ranked in order of medical urgency and the organ is offered to the surgeon of the first patient on the waiting list. Surprisingly, 45 percent of livers are rejected by the first surgeon to whom they are offered.
The first chapter shows, using data from the national organ allocation registry, that surgeons’ behavior is consistent with an optimal stopping problem; surgeons reject poor quality organs for healthy patients in the hope that they will receive a better organ offer in the future. A structural model shows that surgeons’ willingness to use poor-quality organs is responsive to technological change and organ availability. One criticisms of the current allocation system is that many patients are placed on the waiting list in a healthy state but only receive a transplant once they reach the sickest urgency category, at which point their ability to survive the transplant operation is diminished. The rest of the dissertation examines this aspect of the allocation system. Chapter 2 presents estimates of the effect of waiting time on the probability of transplant success. Using blood type as an instrument, waiting time is found to have a clinically and statistically significant effect on outcomes. Chapter 3 presents a simulation model of patient outcomes under various allocation rules. The current sickest-first rule results in a large loss of health between listing and transplant, and this loss is directly related to the ratio of organ demand to supply. The fourth and final chapter presents three principles by which to evaluate organ allocation rules. Unlike the standard ethical criteria, these take account of the fact that patient urgency is endogenously determined; a rule that prioritizes patients by urgency will cause more patients to become urgent in the first place.