Repugnancy costs
Repugnancy costs are costs borne by an individual or entity as a result of a stimulus that goes against that individual or entity's cultural mores.Roth, Alvin E. (2007), "Repugnance as a constraint on markets," November, Journal of Economic Perspectives, vol. 21 (3), Summer, pp. 37-58.Roth, Alvin E. (2007), "What Have We Learned From Market Design?," NBER Working Papers 13530, National Bureau of Economic Research, Inc.
Michael Sandel (April 24, 2012), "What Money Can't Buy: The Moral Limits of Markets," Farrar, Straus and Giroux, {{ISBN|978-0-374-20303-0}} [http://www.economist.com/node/21559308 Two new books probe the limits of capitalism] July 21st 2012 The Economist The cost could be emotional, physical, mental or figurative. The stimulus could be anything from food to people to an idea.
These costs are perspective-dependent and individual. They may be different for different groups of people; countries, states, ethnicities, etc.Elias, Julio J. (2008),[http://www.bcentral.cl/conferencias-seminarios/seminarios/pdf/Elias_Repugnance.pdf "The Role of Repugnance in the Development of Markets: The. Case of the Market for Kidneys for Transplants,"] Working paper. The term allows for a clear and understandable way of representing the concept of contextual stigma in a literal and applicable sense.
Repugnancy costs measure the degree of dislike toward a repugnant market or transaction by appealing to the concept of equalizing differences developed by Adam Smith: "What is the minimum compensation that we have to provide to an individual to be willing to allow a repugnant market or transaction?"
Origin
Repugnancy costs were first mentioned in a debate between Alvin Roth and Julio Elias on whether there should be an official market for kidneys.Elias, Julio J. and Roth, Alvin E. (2007),[https://www.wsj.com/articles/SB118901049137818211 "Econ One on One: A Market for Kidneys?"] The Wall Street Journal Online.
The act of buying and selling organs may be against one's cultural mores; it may be repugnant. Hence, this is an additional cost one must bear if such a market was deemed repugnant in the context of one's culture.
In an experimental survey, Elias, Lacetera and Macis (2019) find that preferences for compensation have strong moral foundations; participants in the experiment especially reject direct payments by patients, which they find would violate principles of fairness. Elías, Julio J., Nicola Lacetera, and Mario Macis. 2019. [https://ideas.repec.org/a/aea/aecrev/v109y2019i8p2855-88.html "Paying for Kidneys? A Randomized Survey and Choice Experiment."] American Economic Review, 109 (8): 2855-88.