Article Review Poisoned Water
1. In this particular case, it is not simply enough for the factory owner to state that he cannot afford to operate an economically sound factory. It is not only his economic future, or indeed his legal future, that is at stake-it is also the rights of the individuals whose lives may be affected by his environmentally and economically irresponsible behavior. Furthermore, clean water is a scarce resource. Unlike sunlight, it is not naturally renewable. By tainting this resource, the individual impedes the economic development of others. For instance, if I cannot go to work because I am sickened by the pollution from the factory, my own economic health One useful economic model to deploy when examining the irresponsible
Allocating the property rights to those who use the river as their primary source of clean water would generate an allocatively effective outcome because those individuals would have a personal and economic interest in keeping the water clean. Thus, the factory owner has no incentive to clean up the river if he continues to possess exclusive property rights to the river. ehavior of the factory owner might be to posit the Classical model of economics, as suggested by Adam Smith, which in fact does not propose an entirely 'hands off' relationship between government and industry. Were his own economic future and health as an economic actor at risk, the owner would behave differently. At present, the current possessor of the rights to the water does not have such self-interest at stake. For instance, if a monopoly develops, the government, in this economic model, the government free to step in and break down the monopoly, to recreate a free economy where competitors can generate a healthy economic stasis of supply and demand. Here, the government must step in and assert that a healthy environment must be created for the general welfare as well as the economic stasis of all afflicted members of the community who are not privy to access to other sources of clean water. In requiring him to clean up the river, some inequalities may result in terms of cost allocations-individuals who buy products from the factory will have these clean-up costs passed on to them. Of course, the factory owner would like it, if other individuals were forced to subsidize the cleanup, even if they had no interest in the factory remaining nearby because they did not purchase its products. However, as they benefited from the cheapness of goods produced in an economically inefficient fashion, this at least distributes the unfairness more equitably, rather than simply penalizing all of those who have no other recourse than to drink the water polluted by the factory. The owner of the factory who is polluting the water only has an interest in recouping his investment and making the factory economically viable by producing goods as cheaply as possible, so he can price them as cheaply as possible on the open market. However, currently, the individuals using the water are being hurt by its continued pollution and receive no benefits from the factory's proximity-while the factory owner benefits economically by being able to position his factory by the water and poison the water, and is not being penalized for this, except perhaps in terms of negative public relations accrued by his factory's brand name.
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