What is donor’s dilemma in economics?

August 13, 2018 12:15 am | Updated 12:37 am IST

This refers to a paradoxical situation where the offering of monetary incentives for the donation of human blood causes a fall in the actual number of donations. This is believed to happen because donors who previously donated purely out of their altruistic beliefs tend to no longer have enough altruistic incentive to continue donating blood when they are offered money in return for their donation. Critics, however, have argued that the offering of monetary incentives can actually increase the donation of blood as people willing to donate for money will more than offset the loss of altruistic donors.

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