It's worth doing when the -true cost of resources- is represented in their price.
If it's not, then more of the thing ends up being done than is socially optimal.
E.g. artificially cheap agricultural water -> lots of water-heavy crops being produced like alfalfa and exported for less than the cost of the water.
I think we might disagree about the degree to this is true, but I think most of us can agree that the true cost of energy is not completely included in its price.
If it's not, then more of the thing ends up being done than is socially optimal.
E.g. artificially cheap agricultural water -> lots of water-heavy crops being produced like alfalfa and exported for less than the cost of the water.
I think we might disagree about the degree to this is true, but I think most of us can agree that the true cost of energy is not completely included in its price.