In the infamous memo, LP wrote:
>I've always though that under-populated countries in Africa are vastly
>UNDER-polluted, their air quality is probably vastly inefficiently low compared to
>Los Angeles or Mexico City.
I don't understand this sentence. First, it's a comma splice (says the grammar queen
in me); second, shouldn't the idea be that Africa's air quality is to inefficiently
high?--that is, the marginal returns from a little pollution are less than the costs?
Brad wrote:
>Points (2) and (3), by contrast, seem to me to be correct. World
social welfare would rise if we moved polluting industries out of the
Los Angeles basin to someplace poorer with cleaner air.
But, says the memo, they are bound to place--untradable; or the cost of trading waste
is too high, yes? This makes sense, in its own way. But then the question is, who is
going to reap the benefits of increased social welfare? And measured how?
The sentence at the end of the memo seems to suggest that, rather than suggesting this
as a policy, LP was distilling the problem of making such a case public. The economic
logic of pollution sounds cruel and counterintuitive, on the one hand; conceding to
arguments against it leaves WB policy open to criticism on all forms of
liberalization, on the other.
Christian
