Price Regulation Vs Water Regulation
The topic regarding methods of the exhaustive natural resources preservation is crucial. It has been disputed by many scientists all over the world. Creation and implementation of the efficient tactics in urban water conservation will be economically beneficial to the state, the facilities providing water to the population and to the members of the community in general.
The article “Comparing price and nonprice approaches to urban water conservation” (Olmstead and Stavins 1-10) is concentrated on the comparison of command-and-control and market-based conservation approaches. The research is very thorough but due to the author’s preferences of the market-based water conservation approach, all the arguments and examples that are shown in the article are intended to prove the author’s point of view. This gives a rise to many questions and provides a good topic for discussion.
In particular, the author suggests moving from the command-and-control approached to market based approaches without any compromises or combination of these methods. I cannot agree with this point of view due to the fact that the implementation of the market based approach will not be successful in all the communities. Specifically, the people in the cities where the population’s income is low or average will not be satisfied with the sufficient water prices increase inasmuch as they will have to spend more on water and will be able to provide less for their families. Thus, the reaction of these people to the prices increase will be harsh and may turn into a mass protest. Moreover, various communities have people with different mentalities. Some of the cities might be more supportive of the resources preservation and do everything directed at the conservation of water. If the prices are substantially increased in these communities, it might dissatisfy the people and be evaluated as pressure and unfairness of the political actions towards the people of the community. What is more, the prices increase, while creating pressure for the poor will have a very little influence on the people with high income inasmuch as usually, those who are rich do not pay much attention to the preservation of the resources or for their cost. The change of the prices for water may also negatively affect the small business that will have to increase the cost of the products and services due to the higher bills, which may lead to the reduction of clients and thus, collapse of the business. The approach will not work as is in all the counties of the international community due to different traditions, regulations and ways of thinking.
The author also recommends to provide the consumer rebates to the people who are most influenced by the water price increase. The author states the idea, but does not give it much thought. Such important aspects as the evaluation of the rebates rate, calculation of the rebate and the criteria for the determination of the consumers who will receive it remain undiscovered. Will the people with the low income, but high water consumption receive …
