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Equilibrium Allocations Under Alternative Waitlist Designs: Evidence From Deceased Donor Kidneys
Author(s) -
Agarwal Nikhil,
Ashlagi Itai,
Rees Michael A.,
Somaini Paulo,
Waldinger Daniel
Publication year - 2021
Publication title -
econometrica
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 16.7
H-Index - 199
eISSN - 1468-0262
pISSN - 0012-9682
DOI - 10.3982/ecta17017
Subject(s) - welfare , redistribution (election) , benchmark (surveying) , economics , mechanism (biology) , microeconomics , econometrics , philosophy , geodesy , epistemology , politics , political science , law , market economy , geography
Waitlists are often used to ration scarce resources, but the trade‐offs in designing these mechanisms depend on agents' preferences. We study equilibrium allocations under alternative designs for the deceased donor kidney waitlist. We model the decision to accept an organ or wait for a preferable one as an optimal stopping problem and estimate preferences using administrative data from the New York City area. Our estimates show that while some kidney types are desirable for all patients, there is substantial match‐specific heterogeneity in values. We then develop methods to evaluate alternative mechanisms, comparing their effects on patient welfare to an equivalent change in donor supply. Past reforms to the kidney waitlist primarily resulted in redistribution, with similar welfare and organ discard rates to the benchmark first‐come, first‐served mechanism. These mechanisms and other commonly studied theoretical benchmarks remain far from optimal. We design a mechanism that increases patient welfare by the equivalent of an 18.2% increase in donor supply.