Environmental Economics

Prof. Fishelson from Tel Aviv University solved that problem a decade ago. The Israeli Government was considering military options as Siria, which is upstream, was damming off and consuming for irrigation the sources of the Jordan River. He said: Nonsense, water is not a scarce resource, it is just another commodity, it can be produced and sold and has a price that can be calculated. His price was 1 US dollar per cubic meter (in fact, nowadays it is 0.4 - 0.5 $/cu m). The amount diverted was 100,000,000 cu m/year, which would never justify war. In fact, no amount of water makes was an option. Israel is now desalinating seawater on an industrial scale and dreaming of selling water to its neighbours. Contamination of water resources, such as lakes and aquifers, should be understood as loss of potential high-quality water supply and the cost of alternative supplies. Since desalination, water lost its magical qualities - at least for Israeli economists.

There's a difference between socially or publicly owned, and state owned property, though. A commons is not necessarily state property. It can be a form of private property.

Roderick Long. "A Plea for Public Property
Carlton Hobbs. "Common Property in Free Market Anarchism: A Missing Link"
Kevin Carson. "Libertarian Property and Privatization"

I thought Katzman had read some of my stuff, and Lomborg is very wrong: It is not a question of distribution, but a question of misuse. Toxicity issues will consume the new century.

I have some difficulty with the Coase argument. Definition of property rights will not cancel the comparative advantage of unprosecutable violation of said property rights--his avowal of the still present need court adjucation fails. Forms of pollution are a case in point. Companies have been specifically formed to be paid to dump Pollutants, scam the Profits, then declare bankruptcy. The Cost of cleanup is immense, with a non-contendre non-payor. lgl

People, water is not like land, which is finite, but a product. Nowadays, no one - not for irrigation, not for industrial use - consumes ¨natural¨, untreated, unprocessed water. All water is, in a sense, ¨polluted¨ and requiring treatment.

What are the policies that could ward off a water shortage, and will such policies be followed?

Here in Israel we have thought hard on the first question, and our answer is that water is a product, and water shortage can be avoided by (1) manipulating the price to balance supply and demand, (2) letting free market forces to increase production. Since the water industry seems to be a "natural monopoly", if there is such thing, and Israel has a very hard time to dissolve entrenched state monopolies, the answer to the second part of the question is unknown to me.