Markets

Brandon Scarborough
August 2007By Brandon Scarborough and Hertha Lund
Brandon Scarborough
Irrespective of the uncertainties surrounding the causes of climate change, the United States is poised to join the rest of the developed world in a fight against rising carbon dioxide levels.
Editor's note: In the winter of 1988, Peter J. Hill, a PERC senior fellow and a professor of economics at Wheaton College of Wheaton, Illinois, wrote the following article on markets and morality.
Richard Stroup
The InsiderSpring 2005 By James Gwartney, Richard L. Stroup, and Dwight R. Lee
Terry Anderson
The Weekly StandardApril 25, 2005 By Terry L. Anderson
Terry Anderson
Case Western Reserve Law Review Fall 2004 Vol. 55:1By Terry L. Anderson
David Simpson
What is the best way to preserve species-rich tropical habitats? During the past two decades, international conservation groups have attempted to save habitats by combining conservation with development.
Bruce Yandle
RS-02-1a Update:  2004Bruce Yandle, Madhusudan Bhattarai, and Maya Vijayaraghavan
With abundant rainfall, the southeastern United States has rarely experienced conflicts over the allocation of water. But that is changing. As population grows, the demand for water grows, and when periodic drought occurs, disputes can result.
Daniel Benjamin
This essay, "Eight Great Myths of Recycling," by Daniel K. Benjamin, exposes the errors and falsehoods underlying the rhetoric. It clarifies the appropriate role of recycling, based on history and market relationships.
Terry Anderson, J. Bishop Grewell
Bringing environmental issues into foreign policy-making and international law endangers trade, national sovereignty, and, ironically, long-term environmental improvement, according to two associates of the Political Economy Research Center (PERC).
Jane Shaw
A new paper challenges conventional wisdom about the role of business in environmental issues. Written primarily for business executives, it offers new ideas for addressing environmental challenges while keeping a principled commitment to market competition, consumer choice, and innovation.
Terry Anderson
Water MarketsPriming the Invisible PumpTerry L. Anderson and Pamela S. Snyder
Peter Hill, Terry Anderson
Water Marketing--The Next GenerationTerry L. Anderson and Peter J. Hill, Editors
Peter Hill, Terry Anderson
Terry L. Anderson and Peter J. Hill, Editors
Terry Anderson
More Books by PERC Authors and Editors:
Terry Anderson
More Books by PERC Authors and Editors:
Terry Anderson, Brandon Scarborough, Reed Watson
Authors Reed Watson and Brandon Scarborough briefly describe and give examples of how water markets can not only provide water where it is needed most, but avoid the acrimony of past water disputes.
Terry Anderson, Brandon Scarborough, Reed Watson
Jane Shaw
By C. Kenneth Orski and Jane S. Shaw
Read more about Milton Friedman
Matt Ridley
A 30th Anniversary Celebration ofPERC—Property and Environment Research Center
Terry Anderson, Gary Libecap
Where water markets are being allowed to work, prices reflect scarcity and trades provide incentives to conserve.
China's growing wealth and economic power means it also vested in seeing the US propser as it holds a huge amount of US debt and remains an important trading partner.
Steven F. Hayward
By Steve Hayward
Laura Huggins
PERC Director of Outreach Laura Huggins explores how free market environmentalism is working to save 40 million acres of Patagonia grasslands.
Reed Watson, Peter Hill, Shawn Regan, Laura Huggins
Listen as Aaron Flint of "Voices of Montana" talks with Reed Watson, P.J. Hill, Shawn Regan, and Laura Huggins about free market environmentalism.
Reed Watson
February 12, 2014 -- Reed Watson on The Jason lewis Show discusses the need for water markets to solve California's acute water scarcity.
Reed Watson
Reed Watson discusses new opportunities for California water markets on the John Batchelor Show.
What's ahead for global energy markets? How will the U.S. shale revolution affect our energy future? To find out, we asked Stephen Arbogast, an expert with more than thirty years of experience in finance working with the energy sector. As Prof. Arbogast explains, when it comes to global energy markets, the next decade will look very different from the last four decades. Stephen Arbogast is an Executive Professor of Finance at the C.T. Bauer College of Business, University of Houston. In that capacity, he has authored more than 70 case studies on technical and economic aspects of the energy business. He is also the author of the book Resisting Corporate Corruption, now in its second edition. Prof. Arbogast has taught in graduate MBA programs since 1987 and was awarded the Bauer College Payne Teaching Excellence Award in 2008.We thank Prof. Arbogast for taking the time to answer our questions. For more PERC Q&As, visit the series archive.Q: You’ve said that when it comes to the geopolitics of energy, the next decade could look quite different than the last four decades. What do you mean by that?A: The last four decades have been dominated by the operations of the OPEC cartel. With only occasional exceptions, this cartel has determined the general price level for crude oil. This price represents roughly two-thirds of the price of final products to consumers, so it is most consequential for the cost of energy in developed economies. The next decade could be different for two reasons. The first is the shale revolution. Right now, that revolution—unlocking oil and gas from tight rock formations—is catapulting the U.S. back to a position of world’s leading oil producer. What is not known is the extent to which this will spread to other lands. Many non-OPEC countries, including China, have vast shale resources. To the extent production surges outside of OPEC, the cartel’s dominance will certainly decline.The second issue is more ominous and concerns a key OPEC member, Saudi Arabia. For decades the Saudis have operated as OPEC’s flywheel, absorbing production cuts in times of glut and expanding production to combat scarcity. Will Saudi Arabia remain much as it has been in the years ahead? Will it still be ruled by the extensive Royal House of Saud? One looks at Syria, Egypt, Iraq, Libya, and Iran and wonders.Q: How has OPEC shaped oil politics in the past, and where are we headed?A: In 1973, OPEC discovered it could dictate the short-term price of crude oil. The cartel saw that developed nation oil demand is quite inelastic over the near term. This means the cartel could and did dictate price to its customers. The result then was a 400% price increase that brought to the OECD nations. Over time, the cartel also learned that abrupt price hikes sow seeds of reversion. Price hikes to $40/b in 1980 led to a demand bust and price collapse below $10/b in 1986.These experiences led OPEC, under Saudi leadership, to a price targeting strategy. The cartel seeks prices which balance several objectives. First, they must be high enough to generate current revenue to fund the political models in these states. These political models concentrate wealth in the state and purchase political support with generous handouts and subsidies. Second, the prices should not be so high that they trigger demand destruction undermining the price level’s foundation. Finally, they also should not encourage sustained efforts to replace petroleum with alternative fuels.Surveying the history of price levels since 1973, it must be conceded that OPEC largely achieved these objectives. No alternative fuels “silver bullet” has emerged. Demand for petroleum has grown and most forecasts show it growing for decades to come. Only the shale revolution and regional political stability raise the possibility of shaking the cartel’s grip on the energy price.Q: What role does Saudi Arabia play?A: Saudi Arabia plays the role of “swing producer” within the cartel. This means the Saudi’s reduce production in times of glut and increase it during moments of peak demand. Cartels generally require some member willing to play this role—otherwise supply and demand excesses will drive prices to cyclical peaks and troughs.The Saudis have unique characteristics that, alone among OPEC members, allow them to play this role. First, they possess huge oil reserves, estimated to exceed 200 billion barrels. This allows the Saudis to add production capability and maintain the spare capacity needed to cushion demand peaks. Second, the Saudi have a small population. Until recently that population did not exceed 20 million. This meant that the Kingdom could amass large financial reserves during periods of peak demand and prices. These reserves could then be drawn upon to fund domestic spending when slack demand required the Kingdom to cut production.It is not as clear going forward that the Saudis will be able to play this same role. Despite their ample reserves, the Saudis seem to be having difficulty increasing production capacity beyond 12 million barrels per day. Much of their “spare” is less desirable medium and heavy crude that encounters refining bottlenecks during demand peaks. Meanwhile, a larger, more subsidized population has raised the cost of preserving social peace. Indeed, one can detect elements of domestic concern in the current Saudi hard line towards Syria and Iran.All this said, the graveyards are full of people who prematurely forecast the demise of the House of Saud. The shale revolution, ironically, could pose more of a threat than disturbances among their neighbors if it undermines the crude price and pinches the Saudi paternalistic ruling model. 
Matt Ridley
The death this week of Ronald Coase, one of the world's most-cited economists, comes at a time when there is lively debate about the very issue he raised: why neither markets nor government are panaceas.
Reed Watson, Brett Howell
In response to the Miami Herald
Terry Anderson
Changes in the environment, population, and industry have created water scarcity in some areas. Terry L. Anderson the President of The Property and Environment Research Center and Gretchen W. McClain the CEO of Xylem discuss how society can meet these water challenges.
Reed Watson
When the Ancient Mariner observed “water, water everywhere, nor any drop to drink” he would have no intention of sharing a freshwater source, had he found one. Indeed, we are awash with water here on the Blue Planet, but only a small fraction is in the location, volume, and quality needed to satisfy our demands.
John Batchelor interviews PERC's Dino Falaschetti about Tackling the Global Fisheries Challenge. He explains why catch shares are good for fish habitat, fishermen, and consumers all over the world.
Kurt Schnier
John Batchelor interviews Kurt Schnier about PERC’s Enviropreneur Institute. He explains how the value of goods is reflected in prices, and how markets can improve environmental amenities.
This week's Q&A is with Matthew Kahn, a professor at the UCLA Institute of the Environment in the Departments of Economics and Public Policy, and the author of the recent
 By Emily Lambert 2009 PERC Media Fellow
Paul Schwennesen
Paul Schwennesen an Enviropreneur-in-Residence at PERC and a former fellow at the Enviropreneur Institute is one of seven top winners in a global easy contest sponsored by the SEVEN Fund in Cambridge, MA. The topic was the "morality of profit."
By Frank F. Limehouse,Peter C. Melvin,andRobert E. McCormick
H. Spencer Banzhaf
This paper summarizes the state of the academic literature on the implications of environmental justice.

Features

Richard Stroup
The freedom fighter's legacy lives on
Andrew Morriss
By Andrew Morriss The first chapter of the Cayman Turtle Farm story did not end happily. But a new phase in this fabled effort to protect wild sea turtles has begun.
Andrew Morriss
It works in Guatemala, for good reasons.
Daniel Benjamin
Eight great myths about waste disposal still abound. This article refutes them.
J. Bishop Grewell
Certification informs consumers about forest management.
John R. Bockstoce
The maritime fur trade of the Bering Strait was one aspect of the European expansion into the most remote regions of Asia and America. But as we have seen, it fit within a vast global exchange network.
Kelly L. Westover
By Kelly L. Westover
Todd Gartner
By Todd Gartner

Columns

Terry Anderson
ON TARGET Fightin' or Drinkin' By Terry Anderson PERC Reports, June 2007
Daniel Benjamin
High demand for wood products can foster the resurgence of forests.
Daniel Benjamin
Benjamin. Daniel K. Benjamin reports that economists have come up with persuasive evidence that free trade reduces pollution.
Daniel Benjamin
By Daniel K. Benjamin Weitzman says that current income need be adjusted downward by 1 percent at most to account for the loss of exhaustible resources.
Daniel Benjamin
By Daniel K. Benjamin Now we know what a decade of quotas on Japanese cars cost consumers.
Daniel Benjamin
CONSEQUENCES OF CLIMATE CHANGE By Daniel K. Benjamin
Daniel Benjamin
By Daniel K. Benjamin The results of the SO2 tradable emissions program are in-- and the economists were right.
Daniel Benjamin
By Daniel K. Benjamin
Daniel Benjamin
Do people really care about improvements in the environment? As silly as this question might sound, it has proven remarkably difficult for economists to pin down a precise answer.
Terry Anderson
The financial meltdown has led many people, especially politicians, to blame the problem on market failure and to jump on the regulatory bandwagon.

Perspectives

Linda Platts
Life has never been easy in the poor Western Cape township of Vyeboom, South Africa. Yet many illiterate, rural people migrated there from Eastern Cape Province seeking work picking fruit. Instead, they have found a promised land, of sorts, picking snails.
Linda Platts
Compiled by Linda E. Platts
Linda Platts
Pioneer bamboo producers in Mexico are hoping to turn the tables on China and become one of the world's largest producers of bamboo. Although the fact is not widely known, bamboo is actually a grass, which has long grown wild throughout many parts of Mexico.
Linda Platts
In Tanzania, the Nile crocodile is probably best known for its threat to human life. Not only does it snatch villagers from the river banks, but it has even made forays onto the lawns of tourist lodges in search of a tasty meal.
Linda Platts
The rising global demand for paper is forcing producers to look beyond trees to crops such as flax and hemp. The increase in forests set aside for wildlife preserves and recreation is also reducing the availability of wood pulp typically used in papermaking.
Linda Platts
Watch your step, Starbucks. Indigenous farmers from Chiapas, Mexico, are opening cafes in Europe, the United States, and Mexico.
Linda Platts
At Wright-Patterson Air Force Base in Ohio, nearly h
James G. Workman
One sunny day in La Jolla, at the public Windansea Beach, I tried to catch a wave and sit on top of the world. I splashed into the “wild, open, and free” waves with the Beach Boys’ “Surfin’ Safari” melody in my head.  
Andrew Wilson
To keep the water running in LasVegas, recognize scarcity and let water rates rise-- double or even triple. Encourage homeowners to trade water rights. Let the market determine how much water people use, not the water police.
Linda Platts
In the early 1990s, a few lionfish, perhaps a half do
Linda Platts
On the European front, a battle is raging over the rights to the title of first ecological nightclub.
Linda Platts
EBay still generates more revenue, but 1-800-Got-Junk is no slouch, with 300 locations in four countries and expected revenues of $150 million this year.