- If Adam Smith were faced with the problem of procuring donor organs, he might suggest that we would be better off relying on donors’ self-interest rather than their benevolence, and advocate a market solution to distributing this scarce resource. Karl Polanyi, however, might argue that society would be harmed by allowing the market to displace the gift relationships created by voluntary donation. Although both died before successful organ transplantation was possible, use what you have learned of their theories to state the position you think each would take on whether and why organ donations should be organized on a market or solely as gifts, and describe what the social consequences would be. (Remember, this is their opinion, not yours).
"It is not from the benevolence of the butcher, the brewer or the baker that we expect our dinner, but from their regard to their own interest. Nobody but a beggar chooses to depend chiefly upon the benevolence of his fellow-citizens."
The problem to what Adam Smith claims regarding advocating a market solution to distribute the scarce resource, was that it will create a system that would misallocate the scarce resource only to a monopoly of those who can afford to buy the organ living those less capable to pay at a disadvantage. By observing and analyzing the existing trend, even with other commodities, if there are limited supply of a product available in the market the tendency is to make the product very pricey. If this ever happens to human organs which is generally needed by patients—rich and poor alike, it will become a scarce resource that will be following the principles of demand and supply. In the case of the poor but in need, they will not have the capacity to participate in the market system because they would not have the financial capacity to avail of a scarce resource that is being given to the highest buyer. This was primarily the contention that Karl Polanyi tries to reiterate in his counter-argument of Smith’s proposal. Nevertheless, the gift relationships created by voluntary donation offers an opportunity of creating a state of equilibrium in which every consumer have the equal capacity as well as opportunity to be awarded the commodity that they deserve. In the gift relationship system every consumer has an equal capacity because their ability to pay for the item is not an issue in this system. Rather, it is the urgency and the need of the consumer which becomes an imperative reason why he or she is awarded of the commodity. The concept of demand and supply should never apply to commodities that are scarce and that are immensely important for the survival of humanity. According to Polanyi, while Smith’s logical analysis that people should not depend on the benevolence of their fellowmen is reasonable and just, there are certain things that warrants exception. The issue about organ donation is not so much on the price that is to be a wager for the “organ” that is considered here as a commodity. It should be remembered that the principle of organ donation is still on the usefulness of the item to the consumer as pointed out by Polanyi.
- In “Selling Genes, Selling Gender” Almeling describes the markets for human sperm and eggs. Unlike donors for most other human tissue, “donors” in these markets are paid. Both eggs and sperm are equally necessary for the conception of a child, yet egg donors are paid much larger sums than sperm donors. Almeling argues that the reasons for this discrepancy are biological, economic, and social. Describe these factors, then explain how agencies use cultural norms of motherhood to construct egg donation as a gift exchange, while considering sperm donation as a “job.” How do the social processes of commodification in this case depend, at least in part, on sex and gender?
In the article entitled Selling Genes, Selling Gender: A Comparison of Egg and Sperm Donation written by Rene Almeling, the author talks about the comparison of sperm and egg donation . The author here uses the concept of commodification in the discipline of economics. Marx defined commodification as is the transformation of goods and services, as well as ideas or other entities that normally may not be considered goods, into a commodity . Again, in this article and discussion, the aspect of demand and supply and the principle of commodification offers the best analogy. A woman can only produce one egg during fertilization. Given this condition, this is considered a valuable commodity that cannot be displaced because of the important feature of the object. While a woman’s egg cell may appear without economic value, it is rationalized that it becomes pricey when there is a market that establish the need and necessity for the said commodity. This is the circumstance by which the egg cell which happens to be without economic value will be converted to a commodity of value. This displaces the social value that motherhood has because it becomes a commodity that is subject for distribution in exchange for a particular denomination or monetary worth. In addition, the process necessary for harvesting a woman’s egg cell involves an intricate process that makes the economic value of the commodity. On the other hand, men’s sperm cell are not as pricey as a woman’s egg cell because prior to having its economic value through the process of commodification, the social value that is placed on the sperm cell is not as high as the social value placed on the egg cell. The egg cell’s social value is associated with motherhood. This association increases the social value of the item which significantly affects the economic value of egg cells. This is the aspect that is missing in the commodification of sperm cells. Marx’s principle of commodification places value on the “social valuation of a commodity” in the process of converting the goods into a commodity.
The argument on the commodification of the egg and sperm cell can apply Karl Marx’s belief that commodification is considered “slavery.” According to Marx and as shared by Almeling, human beings are being converted to products and commodities that are subject to price. It means that the social relevance and the value of life has submerged into a level of pure economic monopoly where even human being are sold and wagered for a price. Humans are never meant to be sold nor brought. This is the point that the opposition of the principle of commodification was trying to achieve. In addition, it is also the author’s argument that commodification has severe social impact which fosters alienation. Thus, unless society can benefit from an individual’s usefulness, value or economic worth they will not also have the social value that is tantamount to its economic equivalence.
- What is meant by the “financialization” of the US economy? Describe the economic and institutional changes that have accompanied this process. Finally, what are the consequences of financialization for the distribution of wealth and income as well as for the global economy?
In 2007, prior to the global economic recession, economist Thomas Palley wrote about the importance of financialization. However, before one could grasp the relevance and significance of this system in the economy, it best to offer a definition that would explain who the concept of financialization works to benefit the economy and facilitate the efficient and effective distribution of wealth of wealth and income. Palley defines financialization is a process whereby financial markets, financial institutions, and financial elites gain greater influence over economic policy and economic outcomes . With the process of financialization in the financial institutions it creates a monopoly of elites who can at any time make the financial and economic system works to favor a limited stakeholders. This results to the strict but limited distribution of wealth which could significantly create an imbalance in the social structure. This furthers the gap between the rich and the poor creating a stressed economic environment. In addition, the financialization could also result to the fall of the market system because of the aggregate distribution of resources as dictated by those who have the financial capacity and financial control to manipulate the movement and flow of resources in major financial institutions worldwide.
In fact. It is believed that the financialization of major institutions contributed to the significant effect of the global financial economic crisis that has brought the entire global economy in much dilemma. The financialization of institutions will only create a demarcation of the rich and the poor. It will establish the division of the social classes because financialization will establish that only those who have the financial capacity will have the upper hand in influencing the formulation and implementations relating to fiscal policies.
References
Appadurai, Arjun. The Social Life of Things: Commodities in a Cultural Perspective. Cambridge: Cambridge University Press, 1986. Print.
Palley, Thomas. "White Paper: The Levy Economics Institute." 8 December 2008. The Levy Economics Institute Website . Web. 16 December 2014.
Roth, Al. Market Design: Misc. organ transplant commentary and news. 11 May 2010. Web. 16 December 2014.
