Wednesday, November 12, 2003

Markets and Sex Selection

Chris Bertram at Crooked Timber responds to a British agency’s recommendation that sex selection (i.e., parents deliberately using genetic screening or other devices to assure the sex of choice for their children) ought to be banned. Bertram’s reaction is dead-on:
The HFEA [Human Fertilisation and Embryology Authority] is arguing (and the Secretary of State is agreeing) that acts should be prohibited where a majority opposes them unless permitting those acts would have definite benefits for society at large. But this is to get the burden of proof completely the wrong way round. Whatever majorities think about some aspect of individual conduct, in a liberal society it has to be clearly demonstrable that an action would be harmful if prohibition is to be justified. No such justification has been produced.
Exactly. Moreover, I’m curious as to what the alleged harms might be. Setting aside the mere desire to avoid “playing God” (whatever that means), I’m guessing the aversion to sex selection is driven by fear of the Chinese syndrome. In China, parents strongly favor male over female children, resulting in a high male-to-female ratio that has (supposedly) been the source of various social problems. But is there any basis for thinking a similar effect could occur in the U.K., or other industrialized Western nations? Setting aside the cultural differences, at least two other factors set China apart: First, the “one-child” policy makes parents choose between male and female children instead of having both. Second, much of China is still underdeveloped and rural, and in that context, children are typically valued primarily as farm hands.

In any case, I wonder if there could be a market solution to a hypothetical shortage of women, if one actually occurred. In market systems, when a valuable asset becomes scarce, its price (unless constrained) tends to rise, thereby attracting more supply to the market. Relatively abundant assets get lower prices. Now, the mating market differs in important ways from other markets, not the least of which is the apparent absence of prices. Still, there are other forms of compensation. If parents care at all about their children’s future welfare, they will consider their children’s likely mating prospects. If women are in short supply, prospective parents choosing the sex of their child will know that a male child has a greater chance of not getting a mate, and thus a greater chance of having a less than fulfilling life. A female child, on the hand, would have greater options and the ability to pick and choose among potential suitors. If the disparity were great enough, grown female children might even be able to command “reverse dowries” for the support of their families.

Arguably, there could be an externality problem that thwarts the market solution. Parents who choose to have a female child would create benefits for all potential future suitors. Of course, competition among males would tend to transfer such benefits to the female side of the market if females are in short supply. But if the female child had the right to choose her mate without demanding compensation for her parents, then the daughter could capture all the benefits created by her parents’ choice. For those benefits to be experienced by the parents, they must feel some satisfaction from their daughter’s happiness. Without such familial attachments, they lack a strong incentive to have female children, and thus the market solution doesn’t work as well. Still, I think my argument indicates a natural limit to the extent of sex selection, because eventually the higher returns to female children would induce sex selection in the opposite direction.

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