A positive analysis of financial incentives for cadaveric organ donation

Financial incentives of various kinds have been suggested to alleviate the chronic shortage of transplantable organs in the United States. This paper analyzes the possible consequences of financial incentives on organ supply. We show that under current practice and Current law (which are not the same), inducements to donate organs or to register as an organ donor may lead to a decline in the supply of organs. Furthermore, some financial incentives that have been proposed lead to time inconsistent choices. (C) 2001 Elsevier Science B.V. All rights reserved. JEL classification: I11; I18; D82.