Robert Fogel Interview

Here is an oddity about the US water supply system. It is one of the few areas where the US is more socialistic than most other countries. Most of our water supply systems are owned by municipal level governments, and generally function pretty well. In many other countries water is privately supplied, and the World Bank has for some time been encouraging a privatization of water supplies drive globally.

An even weirder aspect of this is that one of those countries with mostly privately supplied water is France, and the two biggest companies that supply water in France are the two biggest i the world, and the leading beneficiaries of this global privatization drive.

Even more curious is that those two companies are the same two that inspired civil engineer Augustin Cournot back in 1838 to be the first to apply calculus to economics when he studied the profit-maximizing behavior of a duopoly of firms, in his case, these two firms supplying a city with water out of a single lake, with his solution being a predecessor and special case of the Nash equilibrium.

Most of our water supply systems are owned by municipal level governments, and generally function pretty well.

I think that depends on your definition of 'pretty well'. Remember that the plot of the movie 'Chinatown' revolved around the corruption of the Los Angeles water supply. Even if that was wildly overdramatized, anytime a valuable asset is owned by a political entity there will be vicious competition to get favors from that entity.

It's also interesting that some of Europe's more advanced than we are at privatizing infrastructure. Bridges in France, turnpikes in Italy, and http://www.wwuk.co.uk/

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