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KEYNOTE ADDRESS-AN ECONOMIST'S VIEW OF POLLUTION John W. Hicks III, Executive Assistant Office of the President Purdue University West Lafayette, Indiana 47907 As I'm sure you are aware, the original speaker for this spot on the program had to cancel out, and Jim Etzel was forced to go to the bench for a pinch-hitter. His first choice was Earl Butz, but as you might expect, Earl had other commitments. Jimmy did not want to leave the Rose Garden, and Rosalyn was busy in Illinois with ERA. Jim even tried to get one of the joint chiefs of staff out here, but their helicopter broke down. So here I am and I don't know the first thing about industrial waste. But a minor factor like that has never prevented an economist from discoursing on any subject in the world. Yet economists do sometimes have a useful way of looking at things. It is sometimes helpful to stand back a bit and try to view a problem in a somewhat different perspective. It is so easy to get lost in the detads, that we may forget where we really want to go, or at least become confused as to how to get there. What I plan to do then is to take a brief look at the problem of pollution in our modern society, as an economist might approach it, and talk briefly about some of the basic considerations we might keep in mind as we develop and implement public policy. ECONOMIC PRINCIPLES Fortunately, I do not have to convince you that industrial waste is a major problem of our modern industrial world, or that our public policy efforts to solve this problem have been less than perfect. Let me begin with a few very simple economic facts of life which I'm sure you all know, but which we sometimes forget at least temporarily: 1. Everything has a cost! But, beyond that, in the last analysis, all costs are paid by people—individual human beings. 2. In nearly all cases, overcoming pollution-that is removing the pollutant-is an "increasing cost" industry. 3. Human beings being as they are, economic incentives are very strong incentives. 4. The only way for some to have more, without others having less, is to increase productivity. These are four vital economic priniciples which should never be forgotten in developing public policy regarding industrial waste. There is another important point on which I find a great deal of confusion—an oversimplification concerning public policy to the effect that the alternatives are the "free market" versus regulation: That these are polar alternatives, which are mutually exclusive. This misconception leads to much fuzzy thinking, and much emotion. It simply isn't true. It is often stated that if we would only return to the unregulated competitive market we would solve most of our problems. The shortcoming of this agrument is that there is no such thing, and can be no such thing as an unregulated competitive market. It takes a substantial set of laws, rules or regulations to have a competitive market which wdl work at all. This is clear when one raises and tries to answer the question: what does an unregulated competitive market mean? 898
Object Description
Purdue Identification Number | ETRIWC198089 |
Title | Keynote address : an economist's view of pollution |
Author | Hicks, John W. |
Date of Original | 1980 |
Conference Title | Proceedings of the 35th Industrial Waste Conference |
Conference Front Matter (copy and paste) | http://earchives.lib.purdue.edu/u?/engext,31542 |
Extent of Original | p. 898-901 |
Collection Title | Engineering Technical Reports Collection, Purdue University |
Repository | Purdue University Libraries |
Rights Statement | Digital object copyright Purdue University. All rights reserved. |
Language | eng |
Type (DCMI) | text |
Format | JP2 |
Date Digitized | 2009-10-22 |
Capture Device | Fujitsu fi-5650C |
Capture Details | ScandAll 21 |
Resolution | 300 ppi |
Color Depth | 8 bit |
Description
Title | page 898 |
Collection Title | Engineering Technical Reports Collection, Purdue University |
Repository | Purdue University Libraries |
Rights Statement | Digital copyright Purdue University. All rights reserved. |
Language | eng |
Type (DCMI) | text |
Format | JP2 |
Capture Device | Fujitsu fi-5650C |
Capture Details | ScandAll 21 |
Transcript | KEYNOTE ADDRESS-AN ECONOMIST'S VIEW OF POLLUTION John W. Hicks III, Executive Assistant Office of the President Purdue University West Lafayette, Indiana 47907 As I'm sure you are aware, the original speaker for this spot on the program had to cancel out, and Jim Etzel was forced to go to the bench for a pinch-hitter. His first choice was Earl Butz, but as you might expect, Earl had other commitments. Jimmy did not want to leave the Rose Garden, and Rosalyn was busy in Illinois with ERA. Jim even tried to get one of the joint chiefs of staff out here, but their helicopter broke down. So here I am and I don't know the first thing about industrial waste. But a minor factor like that has never prevented an economist from discoursing on any subject in the world. Yet economists do sometimes have a useful way of looking at things. It is sometimes helpful to stand back a bit and try to view a problem in a somewhat different perspective. It is so easy to get lost in the detads, that we may forget where we really want to go, or at least become confused as to how to get there. What I plan to do then is to take a brief look at the problem of pollution in our modern society, as an economist might approach it, and talk briefly about some of the basic considerations we might keep in mind as we develop and implement public policy. ECONOMIC PRINCIPLES Fortunately, I do not have to convince you that industrial waste is a major problem of our modern industrial world, or that our public policy efforts to solve this problem have been less than perfect. Let me begin with a few very simple economic facts of life which I'm sure you all know, but which we sometimes forget at least temporarily: 1. Everything has a cost! But, beyond that, in the last analysis, all costs are paid by people—individual human beings. 2. In nearly all cases, overcoming pollution-that is removing the pollutant-is an "increasing cost" industry. 3. Human beings being as they are, economic incentives are very strong incentives. 4. The only way for some to have more, without others having less, is to increase productivity. These are four vital economic priniciples which should never be forgotten in developing public policy regarding industrial waste. There is another important point on which I find a great deal of confusion—an oversimplification concerning public policy to the effect that the alternatives are the "free market" versus regulation: That these are polar alternatives, which are mutually exclusive. This misconception leads to much fuzzy thinking, and much emotion. It simply isn't true. It is often stated that if we would only return to the unregulated competitive market we would solve most of our problems. The shortcoming of this agrument is that there is no such thing, and can be no such thing as an unregulated competitive market. It takes a substantial set of laws, rules or regulations to have a competitive market which wdl work at all. This is clear when one raises and tries to answer the question: what does an unregulated competitive market mean? 898 |
Resolution | 300 ppi |
Color Depth | 8 bit |
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