The podcast explores markets that people feel icky about such as surrogacy, assisted end-of-life, trading human organs, seeking revenge in the workplace, and insider trading. It discusses the options of lab-grown organs and implementing a market-based system for transplantation. The podcast also compares the prohibition on alcohol to the prohibition on selling kidneys. Additionally, it features optimization tips, sponsor advertisements, and a discussion on economics TikTok videos. The concept of retaliation in a game show and the use of economics in everyday life are also explored.
Advancements in matching theory algorithms have improved kidney donations, but growing kidneys in a lab may offer a better solution in the future.
The concept of repugnant transactions raises questions about the subjective nature of repugnance in economics and the challenges economists face when advocating for controversial markets.
Deep dives
The Need for Kidney Donations and the Role of Markets
The podcast discusses how advancements in matching theory algorithms have improved kidney donations. However, the speaker suggests that growing kidneys in a lab might be a better solution in the future. They also explore the idea of creating a market for kidneys, highlighting the ethical concerns and objections surrounding the buying and selling of organs. The podcast raises the question of whether the prohibition on kidney markets should be reconsidered, emphasizing the need for more generous incentives for kidney donors.
The Controversy Surrounding Repugnant Transactions
The podcast explores the concept of repugnant transactions in controversial markets. It delves into how certain markets, such as surrogacy and assisted end-of-life transactions, are viewed as morally objectionable and therefore either illegal or heavily regulated. The speaker discusses the dilemma faced by economists who advocate for these markets, as they contend with societal objections and concerns that arise from putting a price on certain goods or services. The podcast provokes further reflection on the subjective nature of repugnance in economics.
Examining Insider Trading and Its Potential Benefits
The podcast raises the question of whether banning insider trading is the most effective approach. It explores the arguments for allowing insider trading, such as the role it plays in price discovery and its potential as a form of compensation for company executives. The speaker emphasizes the idea that insider trading, when regulated, can contribute to more efficient resource allocation. However, they also acknowledge the concerns related to unfair advantages and the potential negative impact on market participants without access to inside information.
There are tons of markets that don't exist because people just don't want to allow a market – for whatever reason, people feel icky about putting a price on something. For example: Surrogacy is a legal industry in parts of the United States, but not in much of the rest of the world. Assisted end-of-life is a legal medical transaction in some states, but is illegal in others.
When we have those knee-jerk reactions and our gut repels us from considering something apparently icky, economics asks us to look a little more closely.
Today on the show, we have three recommendations of things that may feel kinda wrong but economics suggests may actually be the better way. First: Could the matching process of organ donation be more efficient if people could buy and sell organs? Then: Should women seek revenge more often in the workplace? And finally, what if insider trading is actually useful?
This episode was hosted by Mary Childs and Greg Rosalsky. It was produced by Willa Rubin and edited by Jess Jiang. It was engineered by Cena Loffredo. Fact-checking by Sierra Juarez. Alex Goldmark is Planet Money's executive producer.