North Carolina economist Roy Cordato, whom, with his wife Karen, my wife and I became friends with when he was a graduate student at George Mason University and my wife was the editor at the Center for the Study of Market Processes, writes:
Yesterday I gave blood at a local blood drive. The room where it was held, at a local church, was probably about 1.5 times the size of a typical hair salon, maybe a Great Clips. In the room were about six beds for donors, didn’t count, and about 20-25 people with some people coming and going. Everyone had their temperature taken before entering and was wearing a mask. The only person I saw without a mask was actually a police officer. There was no room for social distancing and the waiting area was quite small with a couch and two chairs.
This is deemed safe–and I’m not saying it isn’t–and a hair salon that follows all the same protocols and is only allowing 1 or 2 customers in at a time with everyone else waiting either outside or in their car is not?
Question for those who advocate lockdowns: Should North Carolina’s state government shut down the local blood drive? If so, why? If not, why not?
READER COMMENTS
Alan Goldhammer
May 8 2020 at 11:02am
I was just listening to Planet Money on my walk this AM and they were talking about how to open barber shops!!! The cosmetologists and barbers group got together with some public health people and came up with what sounded like reasonable guidelines for shops to follow. It incorporates social distancing, wearing of masks, changing cover cloths with every customer, and so on.
What strikes me about the anecdote above is no mention at all of any disinfection steps taken on the chairs, etc after someone leaves. this is an absolute necessary step and if the blood bank were not doing it they should be closed down. A normal temperature is no sign that someone is COVID-19 free and there is no telling what was/is on their hands (assuming they are not gloved). Most people continue to touch their face even when wearing gloves. I won’t even comment on the police officer not wearing a mask.
Eric Larson
May 8 2020 at 11:12am
That’s not true as long as those with the disease have higher temperatures than those without the disease. Fever is a symptom. Perhaps, the strength of the signal is dubious, but not it’s existence or sign.
Eric Larson
May 8 2020 at 11:14am
*higher temperatures on average or have a higher probability of having an elevated temperature
Roy Cordato
May 8 2020 at 1:57pm
I didn’t include everything that was done. Yes, chairs were disinfected and the people drawing blood were wearing gloves.
Mark Z
May 8 2020 at 12:41pm
Because the net external cost of a blood drive is lower than that of a series of haircuts (presumably, even in current times, on net, a blood drive has positive externalities). If the net external cost is what should matter in determining whether an activity is banned (or how much it is taxed) then it makes sense that one would sooner ban hair salons from operating than blood drives.
David Henderson
May 8 2020 at 12:48pm
Actually, that’s a good answer. Thanks, Mark Z.
Roy Cordato
May 8 2020 at 2:17pm
Assuming that our liberties should hinge on cost/benefit analysis (which itself is based on a number of questionable assumptions) are you considering the externalities associated with the mental and physical health effects of being unemployed and the costs to the social safety net–unemployment insurance, PPE loans, etc. associated with closing down hair salons?
BC
May 9 2020 at 4:55am
What are the positive externalities from blood donation? Blood is both rivalrous and excludable. Don’t all of the benefits accrue to the blood recipient? The fact that the blood is donated does not create an externality any more than would be the case if people donated haircuts, i.e., one person gifted a haircut to another. Gifting merely transfers the private gains.
If anything, to the extent that people enjoy seeing attractive people, it’s the haircuts that create a positive externality. Not only does the person receiving the haircut benefit, but so does everyone else who prefers seeing attractive people more than ugly people. That external benefit is non-rivalrous and non-excludable.
Let’s not confuse politically popular with externality.
David Henderson
May 9 2020 at 11:30am
Wow! You’re right, BC. I was too quick to credit Mark Z’s response.
Mark Z
May 9 2020 at 11:51pm
I imagine people derive greater utility from friends or relatives being alive and healthy than from seeing strangers with nice haircuts. In any case, I’ll generalize my argument: even if there are no externalities, banning blood donations is still more harmful (at least on a per ‘transaction’ basis) than banning haircuts. The ideal way to deal with externalities is to impose a tax equal to the external cost of the transaction. To use an extreme example, let’s say the risk of spreading coronavirus (and therefore the external cost) of getting a haircut and getting emergency heart surgery is the same, at a cost of $20. If market prices are a good indication of the value of these transactions, then the appropriately taxed haircut is much more likely to no longer be worth it than the appropriately taxed heart surgery.Decisions in higher magnitude transactions in general are going to be less affected by the optimal coronavirus tax. One is much more likely to shrug at the $20 tax added to the cost of an important surgery than a $20 tax that doubles the price of your haircut. And inasmuch as it is impossible to tax behavior that risks spreading the virus and direct controls are used instead, one would sooner ban activities that less likely to still be ‘worth it’ to participants if the ideal tax were imposed than those that are more likely to still be worth it, which is why it generally makes sense to ban cheaper, less valuable transactions than more expensive, more valuable ones.
Blood donations may not be as valuable as emergency heart surgeries, but they’re probably more valuable than haircuts (google tells me the average haircut in the US costs $28; compensation for giving blood is $20-50, when not given for free I assume, inasmuch as we can trust a ‘price’ for a healthcare service in the US to really be a price), so preventing a haircut is more likely to pass a cost-benefit analysis than preventing a blood donation.
Of course, it may be possible and worthwhile to instead just tax businesses for the external cost of virus transmission rather than shut them down outright, but if one is committed to direct controls, obviously the relative risk of spread from a transaction alone should not determine whether it should be prevented. An emergency heart surgery probably risks viral spread far more than a haircut does, but I don’t think anyone would argue that banning emergency surgery is less harmful than banning haircuts.
Mark Z
May 10 2020 at 2:05pm
I should correct myself: apparently you can only get payed for donating plasma.
Matthias Goergens
May 12 2020 at 2:11am
And even that is not very much pay.
Mark Z
May 12 2020 at 1:26pm
Matthias, it is indeed pretty low compensation. Probably less than what a market rate would be if there were a functioning blood market, though I’ve read that giving people cash for blood increases donations by people with blood diseases (who don’t mention this in the screening process), which is a more valid reason than what is usually given for wariness of monetary compensation. Weirdly though, offering non-monetary compensation for blood (such as gift cards) does not appear to lead to increase in ‘bad blood’ donations. Which makes me suspect that giving cash for blood may lead to many drug addicts selling blood, since that’s one cohort that comes to mind that specifically wants cash, and is disproportionately likely to have blood diseases.
Mark S Barbieri
May 8 2020 at 2:43pm
I think that people are lousy judges of what constitutes effective social distancing. That said, I think they do a better job of evaluating things on a situation by situation basis than the government does with broad and inflexible guidelines.
David Seltzer
May 8 2020 at 5:19pm
Mark, fair point. My gym recently reopened. At every workout station is hand sanitizer and disinfectant spray. I’ve observed virtually every one training, follow established protocols out of self interest and concern for others. Equipment is wiped down before and after each person uses it. Social distance is observed voluntarily.
Mark Brady
May 8 2020 at 10:47pm
Serious question. Bearing in mind current stocks at blood banks, how much difference would the temporary suspension of blood drives make to the availability of blood for those who currently need it? In other words, how necessary are blood drives right now? I don’t know, and I seek an informed answer.
Jon Murphy
May 9 2020 at 8:25am
Extraordinarily necessary. As I understand it, blood stocks are critically low because people are afraid to donate because of COVID.
Mark Z
May 10 2020 at 2:08pm
And there is effectively no price mechanism in the blood market to induce a supply response.
Comments are closed.