Markets can have a bad name. People talk of asymmetry of information leading to participants being taken advantage of, regulations intended to protect such participants failing and speculators distorting the prices.
All of the above have seen to be, on occasion, true and I agree - markets are in no way perfect. However today I saw a talk on TED that showed markets can serve a purpose - they can save water.
In the talk Rob Harmon explains that you can use markets to keep water in streams and rivers. His project happens in America, where people can have "use it or lose it" rights to water. If you don't use the water you have a right to, you can potentially lose your right to in the future. This, of course,
leads to hoarding and wasting of the precious resource.
Rob developed a market place where companies that want to reduce their water consumption can pay these individuals to NOT hoard/waste the water, and leave it in the stream. Everybody wins - the company "reduces" their water consumption, the individual receives money for not hoarding/wasting their water and society now has water gushing through it's streams.
The idea here is identical to the European Union Emissions Trading Scheme, where companies that want (or more correctly "have") to reduce their carbon footprint can pay developing countries not to produce carbon they otherwise would have.
It's an intriguing concept, and one must think of potential uses elsewhere - As opposed to other, shall we say "less friendly" alternatives, Egypt could pay Ethiopia to leave water in the Nile, Iraq could pay Turkey to leave water in the Tigris. Yet again, everybody wins.
All of the above have seen to be, on occasion, true and I agree - markets are in no way perfect. However today I saw a talk on TED that showed markets can serve a purpose - they can save water.
In the talk Rob Harmon explains that you can use markets to keep water in streams and rivers. His project happens in America, where people can have "use it or lose it" rights to water. If you don't use the water you have a right to, you can potentially lose your right to in the future. This, of course,
leads to hoarding and wasting of the precious resource.
Rob developed a market place where companies that want to reduce their water consumption can pay these individuals to NOT hoard/waste the water, and leave it in the stream. Everybody wins - the company "reduces" their water consumption, the individual receives money for not hoarding/wasting their water and society now has water gushing through it's streams.
The idea here is identical to the European Union Emissions Trading Scheme, where companies that want (or more correctly "have") to reduce their carbon footprint can pay developing countries not to produce carbon they otherwise would have.
It's an intriguing concept, and one must think of potential uses elsewhere - As opposed to other, shall we say "less friendly" alternatives, Egypt could pay Ethiopia to leave water in the Nile, Iraq could pay Turkey to leave water in the Tigris. Yet again, everybody wins.
No comments:
Post a Comment