The Global Kidney Exchange Programme

In my WSJ review of Al Roth’s excellent book Who Gets What—and Why I wrote about Roth’s proposal to extend the idea of kidney swaps globally:

It’s often the case that a living donor is willing to give a kidney to a loved one, but the loved one can’t accept it because of immunity mismatch. But if a pair of such mismatched donors could be found (call them A and A´ and B and B´), then perhaps a match could be found by a crisscross pairing: Donor A could give to recipient B´ and donor B could give to recipient A´, thus solving the mismatch problem and saving lives.

…Today such multi-way exchanges are becoming common….Mr. Roth, however, wants to go further….why not open U.S. transplants to the world? Imagine that A and A´ are Nigerian while B and B´ are American. Nigeria has virtually no transplant surgery or dialysis available, so in Nigeria patient A’ will die for certain. But if we offered a free transplant to him, and received a kidney for an American patient in return, two lives would be saved.

The plan sounds noble but expensive. Yet remember, Mr. Roth says, “removing an American patient from dialysis saves Medicare a quarter of a million dollars. That’s more than enough to finance two kidney transplants.” So offering a free transplant to the Nigerian patient can save money and lives.

It’s hard to think of a better example of gains from trade (or a better PR coup for the U.S. on the world stage).

Recently, Rees et al., (including Roth) announced the first such global kidney exchange:

We report the 1‐year experience of an initial Filipino pair, whose recipient was transplanted in the United states with an American donor’s kidney at no cost to him. The Filipino donor donated to an American in the United States through a kidney exchange chain. Follow‐up care and medications in the Philippines were supported by funds from the United States. We show that the logistical obstacles in this approach, although considerable, are surmountable.

Naturally, some people aren’t happy because of “ethical” objections. Minerva, Savulescu and Peter Singer write in defense of the program:

Lurking behind all the arguments against the GKE is the assumption that people who are poor are incapable of autonomous choices. So, if they appear to choose to act in ways that benefit not only themselves, but people in HICs, they must have been coerced, exploited, or commodified.

…Poverty does not necessarily make a person unable to choose to donate a kidney to a loved one, nor does it make someone incapable of weighing the pros and cons of an option like that offered by the GKE. Poverty does narrow down the options available to people, and often forces them to settle for an option that is not as good as a wealthy person would choose. That, however, is irrelevant to the ethics of the GKE if that programme provides a better option to patients in LMICs who need a kidney than any other option currently available to them.

…It would be tragic if such misguided objections were to prevent the GKE from realising its potential to reduce suffering and save the lives of rich and poor patients alike.

Hat tip: Frank McCormick.

Harvard sentences to ponder

We show that Harvard encourages applications from many students who effectively have no chance of being admitted, and that this is particularly true for African Americans.

Here is the whole abstract, by Peter Arcidiacono, Josh Kinsler, and Tyler Ransom:

Over the past 20 years, elite colleges in the US have seen dramatic increases in applications. We provide context for part of this trend using detailed data on Harvard University that was unsealed as part of the SFFA v. Harvard lawsuit. We show that Harvard encourages applications from many students who effectively have no chance of being admitted, and that this is particularly true for African Americans. African American applications soared beginning with the Class of 2009, with the increase driven by those with lower SAT scores. Yet there was little change in the share of admits who were African American. We show that this change in applicant behavior resulted in substantial convergence in the overall admissions rates across races yet no change in the large cross-race differences in admissions rates for high-SAT applicants.

And from the paper’s conclusion:

If the goal of recruiting African Americans is not simply to increase the diversity of matriculants, but also to achieve racial balance in the admit pool and/or racial balance in admit rates, then the policy could be deemed a success. As an example, admit rates for African American applicants were twice as large as admit rates for Asian American applicants in 2000, but by 2017 were approximately the same. Why Harvard might careabout the racial distribution of admit rates and applicants is not obvious. What is clear is that each year there are a significant number of African American high school students who have a potentially false impression about their chances of being admitted to Harvard.

Here is the full paper.  And here is a recent paper by Howell, Hurwitz, and Smith, with related results.

The effect of district attourneys on criminal justice outcomes

In the United States, elected district attorneys’ offices prosecute over 85% of all felony cases, but we know little about their effect on local criminal justice outcomes. Using a newly-collected dataset of district attorney elections, I show that Republican district attorneys lead to a 18-21% increase in new prison admissions in the two years following their election, while nonwhite district attorneys lead to a 10% decline. In both cases, there are no significant effects on local crime or arrest rates. These results show that the identity of the local district attorney is an important determinant of incarceration rates.

Here is the paper, by Sam Krumholz, on the job market this year from UCSD, that is not his job market paper, here is his full portfolio, public economics and law and economics, to me one of the more interesting candidates this year.

Monday assorted links

The Prescription Escalator

Ask anyone and they will tell you that their prescription costs are rising. But generic drug prices are falling (also here) and generics are 80-90 percent of all prescriptions. Moreover, although branded drugs are expensive total out-of-pocket costs for the population as a whole are flat or even decreasing as Michael Mandel points out:

[A] May 2019 research report from the Agency for Healthcare Research and Quality reported that average out-of-pocket spending for prescribed medications, among persons who obtained at least one prescribed medication, declined from $327 in 2009 to $238 by 2016, a decrease of 27 percent. Data from the Bureau of Labor Statistics Consumer Expenditure Survey shows that average household spending on prescription drugs fell by 11% between 2013 and 2018.

Moreover, OECD data shows that average out- of-pocket spending on prescribed medicines in the United States ($143 per capita in 2017) is actually lower than countries such as Canada ($144), Korea ($156), Norway ($178), and Switzerland ($215).

So are people simply mistaken about what they are experiencing? Not quite. Mandel uses the metaphor of the prescription escalator to explain the apparent paradox:

It turns out that an escalator is the appropriate model for prescription drug costs for individuals. As people get older, they unwillingly ride the prescription escalator, with their average spending on prescription drugs rising by about 5-6% per year. This figure assumes no change in the underlying price of drugs. Rather, people fill more prescriptions as they age.

In other words, every individual experiences an increase in prescription costs as they age even though for the population as a whole prescription prices are flat or falling–a form of Simpson’s paradox. The driver of higher costs is usage not price. People aged 65-74 have on average 25 (!) prescriptions to fill, more than two and half times as many as people aged 25-34 (about 9 per year).

Understanding the prescription escalator is important because regulating drug prices–aside from being a bad idea–won’t solve the perceived problem.

…even if drug reform efforts were successful and there were no more increases in drug costs, every individual would still face a 5.6% increase each year in drug spending as they got older. That would total 30% after five years, and 70% after ten years, across the board.These are enormous increases.

Indeed, the prescription escalator is a sign of success. If drugs weren’t successful we wouldn’t buy more of them when we were older and sicker and costs wouldn’t rise.

Opioids and labor market participation

The onset of the opioid crisis coincided with the beginning of nearly 15 years of declining labor force participation in the US. Furthermore, the areas most affected by the crisis have generally experienced the worst deteriorations in labor market conditions. Despite these time series and cross-sectional correlations, there is little agreement on the causal effect of opioids on labor market outcomes. I provide new evidence on this question by leveraging a natural experiment which sharply decreased the supply of hydrocodone, one of the most commonly prescribed opioids in the US. I identify the causal impact of this decrease by exploiting pre-existing variation in the extent to which different types of opioids were prescribed across geographies to compare areas more and less exposed to the treatment over time. I find that areas with larger reductions in opioid prescribing experienced relative improvements in employment-to-population ratios, driven primarily by an increase in labor force participation. The regression estimates indicate that a 10 percent decrease in hydrocodone prescriptions increased the employment-to-population ratio by about 0.7 percent. These findings suggest that policies which reduce opioid misuse may also have positive spillovers on the labor market.

That is from a job market paper by David Beheshti at the University of Texas at Austin.

What I’ve been reading

C. Bradley Thompson’s America’s Revolutionary Mind: A Moral History of the American Revolution and the Declaration That Defined It, is a beautifully written history of exactly what the title and subtitle claim.

Also noteworthy is Richard Brookhiser, Give Me Liberty: A History of America’s Exceptional Essays, a kind of companion volume.  Can you beat the title, especially given world trends today?

Eric Schwitzgebel, A Theory of Jerks and Other Philosophical Misadventures.  Collected essays, interesting throughout, and among other points Schwitzgebel shows that ethicists do not in fact behave better than other human beings, higher rates of vegetarianism aside.

I do not have time to read David Abulafia’s The Boundless Sea: A Human History of the Oceans, but based on a browse it is 918 pp. of substance on everything from the Polynesians to the monsoon to sailing across the Atlantic, and then some.

I am a big fan of Yuval Levin, and now he has a new forthcoming book A Time to Build: From Family and Community to Congress and the Campus, How Recommitting to Our Institutions Can Revive the American Dream.

*Terminator: Dark Fate*

Much of the movie is set in Mexico, to excellent effect, and arguably the main lines of the plot mirror some themes from Nahua culture and history:

“…the Aztec saw themselves as “the People of the Sun,” whose divine duty was to wage cosmic war in order to provide the sun with his tlaxcaltiliztli (“nourishment”). Without it, the sun would disappear from the heavens.”  Link here.

Quetzalcoatl descending into the land of the dead, and the breaking of the bones.

“…a sibling rivalry grew between Quetzalcoatl and his brother the mighty sun, who Quetzalcoatl knocked from the sky with a stone club.”

“…When the Aztecs sacrificed people to Huitzilopochtli (the god with warlike aspects) the victim would be placed on a sacrificial stone. The priest would then cut through the abdomen with an obsidian or flint blade.”  Link here.

Overall the movie reminded me of Rogue OneRogue One did not have the freshness or originality of the core Star Wars movies, but it was a member of the actual franchise in a way that some of the later sequels were not, and thus a refreshing reminder of what the whole thing was all about in the first place.

The Causal Effect of Cannabis on Cognition

Does smoking lots of pot make you dumb or do dumb people smoke lots of pot? Mostly, the latter. Ross et al. (2019) write:

Although many researchers have concluded that cannabis causes impairment in cognition, there are alternative explanations. First, poor cognitive functioning is a risk factor for substance use. Specifically, EF measured in childhood predicts later substance use and substance use disorders (SUDs; Ridenour et al., 2009). Thus, studies need to control for prior cognitive functioning (Meier et al., 2012). Second, poor cognitive functioning and cannabis use may also be related, not because one causes the other, but because they share common risk factors, like lower SES (Rogeberg, 2013). Lynskey and Hall (2000) proposed that early use is likely to occur in a social context characterized by affiliations with substance using peers, poor school attendance, and precocious adoption of adult roles including dropping out of school; such an effect on educational participation may also influence later cognitive functioning.

Indeed–twin studies which control for genetics and family environment–do not find that cannabis reduces cognition:

Lyons et al. (2004) examined MZ twins discordant for use 20 years after regular use, and found a significant difference between twins on only one of 50+ measures of cognition. Second, Jackson et al. (2014) found no evidence for a dose-dependent relationship or significant differences in cognition among MZ twins discordant for cannabis use. Similarly, Meier et al. (2017) found no evidence for differences in cognition among a combined sample of MZ and DZ twins discordant for cannabis dependence or use frequency. Thus, quasi-experimental, co-twin control designs have yielded little evidence that cannabis causes poorer cognition.

Ross et al. run a similar study but testing also for executive function skills–the ability to plan, focus, control impulses and so forth which are skills related to IQ but distinct–and they conclude:

Families with greater cannabis use showed poorer general cognitive ability. Yet within families, twins with higher use rarely had lower cognitive scores. Overall, there was little evidence for causal effect of cannabis on cognition.

Hat tip: The excellent Kevin Lewis.


Learning is Caring: An Agrarian Origin of American Individualism

I am looking forward to reading this one, from Itzchak Tzachi Raz, who is on the job market from Harvard this year:

This study examines the historical origins of American individualism. I test the hypothesis that local heterogeneity of the physical environment limited the ability of farmers on the American frontier to learn from their successful neighbors, turning them into self-reliant and individualistic people. Consistent with this hypothesis, I find that current residents of counties with higher agrarian heterogeneity are more culturally individualistic, less religious, and have weaker family ties. They are also more likely to support economically progressive policies, to have positive attitudes toward immigrants, and to identify with the Democratic Party. Similarly, counties with higher environmental heterogeneity had higher taxes and a higher provision of public institutions during the 19th century. This pattern is consistent with the substitutability of formal and informal institutions as means to solve collective action problems, and with the association between “communal” values and conservative policies. These findings also suggest that, while understudied, social learning is an important determinant of individualism.

Here is the home page, the paper is not yet available.  Here is his actual job market paper, on adverse possession.  I do hope the author lets me know once this paper is ready, I am very much looking forward to reading it.

Saturday assorted links

Public employee pension and municipal insolvency

This paper studies how governments manage public employee pensions and how this affects insolvency risk. I propose a quantitative model of governments that choose their savings and risk exposure by borrowing/saving in defaultable bonds, borrowing in non-defaultable pension benefits, and saving in a pension fund that earns a risk premium. In insolvency, the government can receive transfers from households who may differ from the government in their preferences for public services and private consumption. I match the model to a panel of CA cities and a hand-collected record of fiscal emergencies. The model predicts that governments are highly vulnerable to another stock market bust. A hypothetical shock to pension funds in 2015 produces twice as many fiscal emergencies as the original 2008-10 shock. In the quantified model, the government undersaves and take excess risk relative to what households would choose. Savings requirements that limit spending to essential services plus 0.3% of cash-on-hand produce large welfare gains for households. Requiring the pension fund to invest more in safe assets decreases household welfare because the lower average return discourages the government from saving.

That is from the job market paper by Sean Myers of Stanford University.

Economists and non-economists on elasticity

From a recent paper by Joanna Venator and Jason Fletcher:

In this paper, we estimate the impacts of abortion clinic closures on access to clinics in terms of distance and congestion, abortion rates, and birth rates. Legislation regulating abortion providers enacted in Wisconsin in 2011-2013 ultimately led to the closure of two of five abortion clinics in Wisconsin, increasing the average distance to the nearest clinic to 55 miles and distance to some counties to over 100 miles. We use a difference-in-differences design to estimate the effect of change in distance to the nearest clinic on birth and abortion rates, using within-county variation across time in distance to identify the effect. We find that a hundred-mile increase in distance to the nearest clinic is associated with 25 percent fewer abortions and 4 percent more births. We see no significant effect of increased congestion at remaining clinics on abortion rates. We find significant racial disparities in who is most affected by abortion clinic closures, with increases in distance increasing birth rates significantly more for Black, Asian, and Hispanic women. Our results suggest that even small numbers of clinic closures can result in significant restrictions to abortion access of similar magnitude to those seen in Texas when a greater number of clinics closed their doors.

There are (at least) two possible responses to such results, and that is without even getting into one’s underlying view of the ethics of abortion.  One is to say that a great deprivation has occurred because many fewer women end up having abortions.  Another response is to infer that the marginal value of the abortions could not have been so high to begin with, if the number drops off so readily.

The same issue comes up with Obamacare.  If the price of health insurance goes up, quite a large number of people decide to go without coverage.  Is the size of that number a measure of the human tragedy resulting from the price increase?  Or is it a measure of how little those people actually value health insurance?  Or somehow both?

I have yet to meet a person who can think through these issues rationally and absorb what is interesting and valid in each of those two perspectives.