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Session: Issues in Incentives
Room: Meeting Rooms 22+23
Time: Thu 14:30-15:45

Presenter: Mireia Jofre-Bonet (City University. Economics)

Abstract

The issue of the nature of the altruism inherent in blood donation and the perverse effects of financial rewards for blood and/or organ donation has been recently revisited by the economics literature. As Titmuss (1970) famously pointed out, providing incentives to blood donors may crowd out blood supply as purely altruistic donors may feel less inclined to donate if a reward is involved. Most of the recent papers analyse the impact that financial rewards have on blood and organ donation. We take a different perspective and a novel approach to analyse this issue. We aim to answer two questions: First, whether donors and non-donors’ have different preferences towards incentives for blood donation. Second, if different types of incentives have the same effect on willingness to donate. We use data from the 2002 Eurobarometer, representative sample of 15 European countries, to estimate two different simultaneous equations systems and an ordered probability model with binary endogeneous switching. Our results indicate that donors and non-donors’ preferences differ. Also, we find that while monetary rewards may crowd-out blood donation, non monetary rewards may not have the same effect.

Key Terms

donation, crowd out, altruism, warm glow

Authors:

Mireia Jofre-Bonet (City University. Economics) , Joan Costa-Font (LSE Health and Social Care. European Institute) and Steven Yen (Tennessee University. Agricultural Economics)

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