Do Plasma Clinics Crowd out Voluntary Blood Donations, and is it a Problem?

• In Event: The Public-Private Mix

Abstract

Few countries in the world allow blood/plasma donors to be compensated with cash payments, but the global supply of blood derived pharmaceutical products depends heavily upon those countries that do. Currently, Canada is considering legislation that would outlaw paying plasma donors, as advocates have argued that the practice is exploitative and is likely to crowd out voluntary, uncompensated blood donations. Meanwhile, as paid plasma clinics expand in the US, many have expressed similar concerns about the potential effects that this will have on traditional blood donation patterns, with possible consequences for the national blood supply. In the first half of this paper, we present the results of a large survey (n=28,000) that characterizes currently blood donation patterns, the reasons people donate, and their sensitivity to cash payments. In the second half of this paper, we employ a novel dataset containing records (n=20 million) of both uncompensated blood donations and paid plasma donations in center that have opened up over a ten-year period in order to examine the crowding out effect of paid plasma, using both pooled cross section time series and differences-in-differences techniques. Tentative results suggest that crowding out is minimal, although the presence of paid clinics may increase the acquisition costs borne by traditional voluntary blood donation clinics. The paper concludes with a discussion of the appropriate policy responses to these findings and larger ethical questions regarding the propriety of compensating donors.

Authors

• William E. English, Georgetown University McDonough School of Business

• Peter Martin Jaworski, Georgetown University