Examples of Repugnant Transactions

How certain transactions can become repugnant

Behavioral Economics Definition

Alvin E. Roth

Evaluating a Controversial Market Proposal

A proposal is made to create a formal, regulated market where wealthy, childless couples could pay a large sum of money to low-income families in exchange for the legal adoption of their newborn infants. Proponents argue this would be a voluntary exchange benefiting both parties: the wealthy couple gets a child, and the low-income family receives life-changing financial resources. Despite the potential for mutual benefit, such a market is highly unlikely to be established in most modern societies. Which of the following best explains the primary barrier to the formation of this market?

Analyzing a Market for Civic Duty

In a market-based economy, a transaction that is guaranteed to be mutually beneficial and economically efficient for all parties involved will always be socially accepted and allowed to occur.

Match each proposed market transaction with the primary reason it is often considered a 'repugnant transaction' in many societies, despite potential willing participants.

The Role of Money in Socially Sensitive Exchanges

A technology firm proposes a new online platform where the highest bidder can purchase the official naming rights for a newly discovered species of butterfly, with a portion of the proceeds going to conservation efforts. Despite the potential funding for science and conservation, the proposal faces significant public backlash and ethical objections against 'commodifying nature'. Based on the economic principles of socially resisted exchanges, what is the most likely outcome for this proposed market?

Analyzing a Controversial Financial Product

Historically, the practice of a woman carrying a pregnancy for another person in exchange for payment was widely considered unacceptable and was legally prohibited in many places. However, in some societies today, this practice has evolved into a legally recognized and regulated industry. Which of the following best explains the primary reason for this market's emergence in those societies?

Evaluating a Policy to Address a Blood Shortage