Surrogate motherhood and the limits of division of labor

I took part in a panel on surrogacy in Sweden organized by Timbro. Watch my talk here:

One of the general points that I make is that while it is only the extent of the market that limits the division of labor, market-making is not costless. More importantly, the character of costs to be incurred while introducing and maintaining markets is not merely technological.

In order to protect the surrogate mothers and the intended parents, entrepreneurs and legislative committees should keep three points in mind:

  1. A surrogacy agreement employing a gestational carrier is not a form of adoption and should not be treated as such.
  2. Public debate is key to reach a broad consensus on the merits of surrogate motherhood.
  3. Full contractual enforcement of voluntary agreements between parties to a surrogacy contract is essential for proper functioning of a system that will provide the means to the ends that childless couples and surrogate mothers pursue.

Find a Swedish version of my article here, the slides to my talk here and the whole discussion here.

Entrepreneurship and Institutional Change

Entrepreneurs do more than just buy low and sell high; they sometimes also change our institutions, including our categories of thought. New institutional economics has been examining incentives that drive individuals to bring about market-supporting institutional arrangements. There is, however, an aspect of entrepreneurship conducive to institutional changes that has been neglected by contemporary institutionalist theories and that remains underdeveloped in entrepreneurship research. When and how does entrepreneurship bring about institutional change? I suggest that entrepreneurs are agents of institutional change when cultural categorization is ambiguous with regard to what the proper and permissible applications of novel artifacts are. Motherhood, for example, used to be a simple category, but surrogacy changed that radically. Examining newspaper evidence, social surveys, statutory law, and judicial cases, I show how entrepreneurs, by provoking a change in interpretation and judgment, challenged the existing institutional legal ordering of procreation turning a technically feasible method of surrogacy into current practice.