Results for “water” 831 found
The Private Rationality of Bottled Water Drinking?
That is a new paper by W. Kip Viscusi, Joel C. Huber, and Jason Bell, the abstract is here:
This article examines evidence for the private rationality of decisions to choose bottled water using a large, nationally representative sample. Consumers are more likely to believe that bottled water is safer or tastes better if they have had adverse experiences with tap water or live in states with more prevalent violations of EPA water quality standards. Perceptions of superior safety, taste, and convenience of bottled water boost consumption of bottled water. Blacks and Hispanics are more likely to drink bottled water due to their relatively greater exposure to unsafe water and greater risk beliefs. The coherent network of experiences, beliefs, and actions is consistent with rational consumer choice.
That is rationality at the margin, of course, as the entire practice of bottled water in developed countries strikes me as not rational for most people. Tap water is fine and to me even tastes better.
Hat tip goes to www.bookforum.com.
“Peak water” for the Middle East
The situation is most serious in the Middle East. According to [Lester] Brown: “Among the countries whose water supply has peaked and begun to decline are Saudi Arabia, Syria, Iraq and Yemen. By 2016 Saudi Arabia projects it will be importing some 15m tonnes of wheat, rice, corn and barley to feed its population of 30 million people. It is the first country to publicly project how aquifer depletion will shrink its grain harvest.
“The world is seeing the collision between population growth and water supply at the regional level. For the first time in history, grain production is dropping in a geographic region with nothing in sight to arrest the decline. Because of the failure of governments in the region to mesh population and water policies, each day now brings 10,000 more people to feed and less irrigation water with which to feed them.”
Brown warns that Syria’s grain production peaked in 2002 and since then has dropped 30%; Iraq has dropped its grain production 33% since 2004; and production in Iran dropped 10% between 2007 and 2012 as its irrigation wells started to go dry.
“Iran is already in deep trouble. It is feeling the effects of shrinking water supplies from overpumping. Yemen is fast becoming a hydrological basket case. Grain production has fallen there by half over the last 35 years. By 2015 irrigated fields will be a rarity and the country will be importing virtually all of its grain.”
The article also offers a pessimistic assessment for China, India, and parts of the United States. Please note that Julian Simon fans should feel no need to rebel against these assessments, which are for resources with no or ill-defined property rights. When it comes to the Middle East and India, it is easy enough to see how institutional constraints might limit possible technological solutions to this problem.
Subsidies for virtual water
From Robert Glennon:
In 2012, the drought-stricken Western United States will ship more than 50 billion gallons of water to China. This water will leave the country embedded in alfalfa–most of it grown in California–and is destined to feed Chinese cows. The strange situation illustrates what is wrong about how we think, or rather don’t think, about water policy in the U.S.
Here is more, and for the pointer I thank the estimable Chug.
Water Economics
The next set of lessons in MRUniversity’s development economics course is on water economics. Water is one of the most important issues in developing countries for many reasons, including agriculture, health, and wealth. Every year, millions of people die because of lack of access to clean and safe water. It is estimated that over 1 billion people in the world don’t have adequate access to such an essential resource, and the poor pay the biggest price.
In this section, we cover:
- The effects water monopolies can have on consumers
- The pros and cons of water privatization in developing nations, including major examples from Buenos Aires, Bolivia, Saudi Arabia and Yemen
- Why it’s so hard to regulate private water companies effectively
- What can happen to the price of water when it is interfered with through subsidies and price controls
- The tragedy of the commons in water economics
- How water ethics influences the actual supply of water
- And finally, what happens when countries engage in trading water commodities
Have the French shown that water privatization is dead?
Some time ago, @ModeledBehavior has requested comment on this article. Excerpt:
Across the nation cash-strapped municipalities are considering the sale of their public-utility systems. These moves are intended to raise cash and rid the municipalities of expensive liabilities such as debt service and pension obligations. But officials considering this approach might do well to look to France and other nations that are rapidly moving in the opposite direction with a “remunicipalization” of their utility systems. In 2010, Paris, in the best known case of remunicipalization, ended contracts with the world’s two biggest water service companies, Suez and Veolia, bringing an end to their 100-year private duopoly. The reversal of a century-old practice in Paris was an acceleration of an international movement away from private control.
So what’s up? I see it this way. For advanced water systems, there is no cost advantage to having a privatized system. It is a regulated monopoly and over time it acquires skill in manipulating the political process, most of all its regulators. Why expect lower costs and prices? A wide variety of studies of this topic, including studies by “market-oriented” economists, find no cost advantage for the private sector in this setting.
For very poor countries, very often water privatization would in principle be a good idea, since the public sector is not supplying much piped water at all. Monopoly is better than carrying a bucket on your head, and you still can carry the bucket if you wish. Yet privatization also won’t get very far in many of these cases. One reason is that there is no way to make people — many of whom are non-registered and lacking in assets — pay their water bills, and not enough legal infrastructure to prevent them from cutting into the pipes or otherwise going rogue. You shouldn’t “blame” privatization here, but still it may not be a useful option.
Finally, there is a sweet spot in the middle, often for reforming or middle-income countries. In those cases water privatization can mobilize private capital rapidly and expand water coverage. It often brings higher quality water, higher quality connections, lower rates of unaccounted-for-water, and higher prices. Not all cities desire that trade-off, but it is there for the taking. Some of these privatizations are done fairly well, others are done very poorly, such as in Cochabamba, where the “privatization” gave the company property rights over previously privately held, decentralized water sources of the poor, such as collected rain.
As long as there are countries in this middle income range, water privatization is not dead nor should it be.
The economics of cholera (water)
From Haiti:
Recently, just behind the base’s barbed-wire periphery, Dieula Sénéchal squatted with her skirt hiked up, scrubbing exuberantly colored clothes while a naked 6-year-old girl, Magalie Louis, defecated by the bank, gnawed on a stalk of sugarcane and then splashed into the water to brush her teeth.
Approaching with a machete on his way to hack some cane, her gap-toothed father, Légénord Louis, said Magalie had contracted cholera late last year but after four days of “special IVs” was restored to health. He knew the river water was probably not safe, he said, but, while they brushed their teeth in it, they did not swallow.
For drinking water, Mr. Louis said, his family relies on a local well. But he lives from hand to mouth and cannot afford water purification tablets; the free supply he got in 2010 ran out long ago. So he gambles.
“If you make it to the hospital,” he said, “you survive the cholera.”
The NYT feature article is interesting throughout.
It’s already dead in the water
“Right now, there is not much more than a blank sheet of paper and even the name of the future treaty might still change,” said Petr Necas, the prime minister of the Czech Republic. “I think that it would be politically short-sighted to come out with strong statements that we should sign that piece of paper.”
There is so much more at the FT link, and from numerous countries. Of course on day one they were all going to say it is great and that they support it. Then the new equilibrium is revealed.
Rising in status: Timur Kuran’s theory of preference falsification, Buchanan and Tullock’s Calculus of Consent, Thomas Schelling’s Strategy of Conflict.
Falling in status: French rationalist constructivism, claiming that the failures of social democratic multinational collective governance stem mainly from a misguided belief in fiscal austerity.
New evidence that being underwater on your house limits labor mobility
Rortybomb has long argued there is no significant effect. I’ve never had a horse in this race, in any case here are new results from Plamen Nenov, on the job market from MIT:
The present paper studies the impact of a housing bust on regional labor reallocation and the labor market. I document a novel empirical fact, which suggests that, by increasing the fraction of households with negative housing equity, a housing bust hinders interregional mobility. I then study a multi-region economy with local labor and housing markets and worker reallocation. The model can account for the positive co-movement of relative house prices and unemployment with gross out-migration and negative co-movement with in-migration observed in the cross section of states. A housing bust creates debt overhang for some workers, which distorts their migration decisions and increases aggregate unemployment in the economy. This adverse effect is amplified when regional slumps are particularly deep as in the recent U.S. recession. In a calibrated version of the model, I find that the regional reallocation effect of the housing bust can account for between 0.2 and 0.5 percentage points of aggregate unemployment and 0.4 and 1.2 percentage points of unemployment in metropolitan areas experiencing deep local recessions in 2010. Finally, I study the labor market effects of two policies proposed for addressing the U.S. mortgage crisis.
I’m still not taking sides here, just fyi.
There are five new popular books on water this year
The two I will recommend are:
Steven Solomon, Water: The Epic Struggle for Wealth, Power, and Civilization. It offers a very good history of water technologies, here is one good review.
David Zetland, The End of Abundance: Economic Solutions to Water Scarcity. Of the five books, this one has the most policy truth. Also, David reviews one of the other books.
The paradox of Tunisian water policy
One quality of life measure put Tunisia first in the Arab world. If you look at water policy, the Tunisian government has long had a strong reputation. Here is Wikipedia:
Tunisia has achieved the highest access rates to water supply and sanitation services among the MENA countries through sound infrastructure policy. 96% of urban dwellers and 52% of the rural population already have access to improved sanitation. By the end of 2006, the access to safe drinking water became close to universal (approaching 100% in urban areas and 90% in rural areas). Tunisia provides good quality drinking water throughout the year.
I've never been to Tunisia, but from readings I've found the country especially difficult to understand. They've had a corrupt autocracy for a long time, but some areas of policy they get (inexplicably?) right. And usually they are by far the least corrupt country in the Maghreb. Dani Rodrik called the place an unsung development miracle. Maybe that was exaggerating but for their neighborhood they still beat a lot of the averages and they've had a lot of upward gradients. They've also made good progress on education.
And now this. Perhaps it is no accident this is "the first time that protests have overthrown an Arab leader." The lesson perhaps is that the path toward a much better world involves…small steps. Civil society there is relatively strong and has been so for a while. Democracy is probably not around the corner, but if you're studying social change it's worth spending a lot of time on why Tunisia and Jordan are often so much better run than the other Arab states.
Negative Equity in Underwater Homes
Calculated Risk gathers the data on underwater homes:
- There are 14.75 million underwater homes and 4.1 million of these have more than 50% negative equity (the homeowners owe 50%+ more than their homes are worth).
- The total negative equity is $771 billion.
I decided to create a picture:
Waterless Urinals
I found this sign over the waterless urinal at the Woods Hole Oceanographic Institute (where I am hanging out this summer) difficult to parse (or follow).
Ordinarily I wouldn't devote a blog post to this kind of thing but believe it or not, this month's Wired has an excellent article on the science, economics and considerable politics of waterless urinals. Here's one bit:
Plumbing codes never contemplated a urinal without water. As a result, Falcon’s fixtures couldn’t be installed legally in most parts of the country. Krug assumed it would be a routine matter to amend the model codes on which most state and city codes are based, but Massey and other plumbers began to argue vehemently against it. The reason the urinal hadn’t changed in decades was because it worked, they argued. Urine could be dangerous, Massey said, and the urinal was not something to trifle with. As a result, in 2003 the organizations that administer the two dominant model codes in the US rejected Falcon’s request to permit installation of waterless urinals. “The plumbers blindsided us,” Krug says. “We didn’t understand what we were up against.”
One thing that does annoy me is the claim that these urinals "save" 40,000 thousand gallons of water a year. Water is not an endangered species. With local exceptions, water is a renewable resource and in plentiful supply. At the average U.S. price, you can buy 40,000 gallons of water for about $80.
Facts about airline water
Fact 1:
In the United States, drinking water safety on airlines is jointly
regulated by the EPA, Food and Drug Administration (FDA), and Federal
Aviation Administration (FAA). EPA regulates the public water systems
that supply water to the airports and the drinking water once it is
onboard the aircraft. FDA has jurisdiction over culinary water (e.g.,
ice) and the points where aircraft obtain water (e.g., pipes or
tankers) at the airport. In addition, air carriers must have
FAA-accepted operation and maintenance programs for all aircraft, this
includes the potable water system. (EPA)
Fact 2:
…the news carried stories that the US EPA had determined that 15% of
water on a sample of 327 aircraft flunked the total coliform standards
and inspections showed that all aircraft were out of compliance with
the national drinking water standards.
Rest assured, the EPA has crafted new rules to address the problem.
How do airplanes float on water?
Surely you've all been wondering, here's one answer I ran across (more at the link):
All airplanes will eventually sink if it is in water, even pressurized
planes. (more on that later) But there are several areas in the
airplane that have pockets of air that help keep the plane afloat. For
example, in the area between the outside skin of the fuselage and the
interrior there is a space that is usually insulated and has air that
needs to be displaced by the water. In most airplanes built today, the
wing is the fuel tank, and since water is heavier than fuel the fuel in
the wings help offset some of the weight of the plane…not a lot but
some.
There is also air in the cargo hold of larger planes that will help
maintain buoyancy until the air is replaced by water. Anyone who thinks
an airplane is water tight and will float because it is pressurized is
nuts! The airplane is pressurized only while the engines are running
and the air being pumped into the aircraft to pressurize it is almost
escaping the aircraft just as fast as it is being pumped in. There are
control valves in the forward and rear bulkhead that regulate the
pressure inside the plane but all pressure is lost if the engines quit
running. At the altitude that the A-320 that crashed in the Hudson
river was at when it lost it's engines, it probably didn't have much
pressurization anyway since it was only a few thousand feet above sea
level.
Pay For It: Radical Water Privatization for Poor Countries
Here is my piece for Forbes.com on the privatization of residential water supply in the Third World. Excerpt:
And no, I don’t mean a water
concession with a price regulated by the government, I mean true
laissez faire in water supply. No price regulation, no rate of return
regulation, no government ownership of assets, no political pressure to
keep prices low. Water companies should be allowed to maximize their
profits, and because supplying water is nearly always a monopoly, they
should be allowed to make monopoly profits. I know the idea sounds
crazy–to an economist, water supply is a classic "natural"
monopoly–but on closer inspection the other alternatives might be
worse.
And more:
If complete deregulation
is too radical for you, consider the interesting compromise proposed by
the economist Jeffrey Sachs, currently heading the Earth Institute at Columbia University.
He suggests that the private company be allowed to charge high prices,
but only under the condition that it allocates a minimum amount of
water for everyone, either for free or at a much lower price. Basic
water needs would be met, and the company still might make a profit.That said, I’m less worried about high prices than Sachs. Let’s say
the new water prices were so high as to capture all the benefits that
buyers would receive from the new supply of water. We can expect much
lower rates of diarrhea and other diseases, if only because the water
supplier can charge more for cleaner and safer water. The resulting
decline in disease means that children will die less frequently and
adults will be healthier and more energetic. Those long-term social
benefits are of enormous help to poor communities, even if high prices
take away many of the initial, upfront benefits of the new water
supply. In other words, we should consider radical privatization
precisely because water is a public good and because clean water is so
important for long-run economic growth.
Read the whole thing.