There has been a lot of scholarly discussion in recent years
about the importance of putting a price on natural resources.
The pricing issue has been particularly in the limelight in
connection with the drought in the western United States.
Indeed, it seems fairly self-evident that, if we give away a scarce
resource, people will consume too much of it.
I suppose, then, that we should not be surprised that we have
already been one-upped on this issue by the Chinese.
According to Tuesday's New York Times, diners at a
restaurant in Zhangjiagang, near Shanghai, have to pay a fee for
the right to breath clean air.
Of course, the pricing mechanism seems flawed, since the diners
are paying a fixed cost, rather than the marginal cost, but markets
have to start somewhere!
