Wednesday, September 26, 2012

The Value of Nothing

One of our coursebooks right now is Raj Patel's, The Value of Nothing, the title coming from Oscar Wilde's quote:

"Nowadays people know the price of everything but the value of nothing."

Even if you haven't read economics I think it can be a good read if you are interested in why things cost what they do.

On Monday in class we had a debate on if pricing nature is the best way to protect it, it's a difficult question! Perhaps we don't need to price it, but what we do need is to value it? However, how do you give something a value in economic terms if you don't give a price to it? Perhaps it is necessary to price nature in some instances, for example when making decisions on to exploit an area or not, if the true cost of exploiting can be seen perhaps a better decision is made. I think this is what the TEEB initative, that I wrote about before, is working on for example. On the other hand, it could be that there is always somebody willing to pay the price and would exploit anyway?

In economics it's usually scarce resources that will get a higher price, a high price on nature could maybe regulate the exploitation, but would it be practically feasible and would it make any sence? When you pay for water do you use it more carefully or how high would the price have to go until you value every drop of it?

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