Wondering when the privatization of water will come, I read this great post on Freakonomics. Back to my favorite law Supply and Demand! In Mexico there is one gas station PEMEX, the nationalized oil industry subsidised by the Mexican government, we have only one price option, I couldn´t even guess how the price is set per liter. In this town we have a choice of purchasing for consumption, 4 maybe 5 brands of water, in the $1.90-$2.50 USD range for a 5 gallon garaphone, I use the garaphones that came with the house (i.e cheapest distributor, $1.90 per 5 gallon).
We have no water bill at our house as we are on a well in an area of San Miguel where the water table is still high. However, to use water we have to turn on an electric pump and the price of electricity is very high here. Lately, I try to avoid watering plants, putting water in the fountain, letting children play in the hose...the price of water has become expensive for us because of the consumption of electricity necessary to turn the water on and we are conserving. Supply and Demand only a little spin because of the use of electricty to generate water. Well, like I keep saying it´s rarely a perfect market. Still this idea of supply and demand holds up, I just wonder about the human consequences of charging for water, can economics account for that?
Cut and paste below or click on the title of this post to take you to the Freakonomics guest post.
http://freakonomics.blogs.nytimes.com/2008/09/11/oil-and-water-a-guest-post/
Thursday, September 11, 2008
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