Incentives and Decision to Donate Blood and Organs

Altruism is often the main motivation for someone to donate blood or live organs. However, shortage of organs is common. This has led to a debate whether financial incentives may supplement the altruistic motive.

In a departure from the literature, we model the interaction between financial incentives and altruistic motives. Because incentives can potentially change altruism, donors respond to financial or non-financial incentives in complex ways.

Each of a set of individuals has to decide whether to be a donor, stop being a donor, and how often to donate if remaining as a donor. Individuals differ in their degrees of altruism. More important, they differ in the way they respond to incentives. Whereas some individuals like incentives, which then complement their altruistic motive to donate, others dislike incentives, which reduce their altruistic motive.

Policies cannot be targeted to specific individuals. This is because individuals’ propensity to donate and aversion to financial incentives are private information. Thus, each policy, in either financial or motivation dimensions, leads to “crowding in” among some individuals, and “crowding out” among others. Financial and non-financial incentives may change the elasticity to donate. Furthermore, they may also change the relative weight an individual puts on the importance of altruistic motive relative to financial incentives. Properly calibrated information about the population average propensity or aversion to incentives is the key. In the end, policy using incentives should increase the number of new donors, or at least increase the frequencies and regularity of donations of current donors.

We conduct a survey based on the model. In a questionnaire on attitudes towards blood and live-organ donations (data collected from 654 respondents of a University population in Navarra, Spain in May-June 2010), we included some questions on financial and non-financial incentives, such as an individual’s expectation about donation costs, as well as warm-glow and other-regarding benefits. The list of incentives proposed was: any reward, fiscal deductions, monetary payment, priority in obtaining health services or waiting list for an organ, social recognition, information on blood donations, and blood tests.

Both potential and veteran donors regarded blood donation as less costly than live-organ donation. Living organ donation was perceived to have more altruistic benefits than blood donation. Non-financial incentives such as blood tests or priority in the waiting list, on average, were preferred to financial incentives by both types of donors, but there were also differences. For offering monetary payments for live-organ donations, the probability of attracting individuals with low willingness to donate exceeded the probability to dissuading those with high willingness to donate. Hence, crowding out would not result in a net loss. For blood donation financial incentives would just crowd-out individuals’ willingness to donate.

We conclude that for encouraging new donors, policies should focus on non–financial incentives. Some individuals could be attracted to living organ donation through financial incentives, but there would still be a risk of losing potential altruistic donors.