Why districts are slow to charge market rates for water (2009) • Hacker News Board

Re: Why districts are slow to charge market rates for water (2009)

#61

Post by ghaff » Mon, May 22, 2023, 9:44 PM UTC

bin_bash wrote: post #50

charlie0 wrote: post #34

Earlier quoted context omitted.

Changing water price on demand is not easy, but I can see dynamic pricing on parking meters ranging from free suring periods of very low usage to a few dollars a hour during high usage.

Parking rates simply needed to be higher, not dynamic. Not saying dynamic pricing is not useful though.

>Parking rates simply needed to be higher

I assume at some level that becomes effectively a tax on businesses though as some shoppers stay away on average (albeit making parking easier for others) while the government collects more revenue. (That said, in a lot of places, there probably isn't enough on-street metered parking to meet demand at any reasonable price.)

Re: Why districts are slow to charge market rates for water (2009)

#62

Post by squokko » Mon, May 22, 2023, 9:51 PM UTC

causality0 wrote: post #59

squokko wrote: post #38

Earlier quoted context omitted.

Because there is a highly nonlinear utility of water, where enough to drink and cook is essential for survival, enough to bathe and wash is essential for a decent life, and then... nothing. If milk was $200 a gallon you could simply not buy any and you'd be fine, which is not the case with water.

So charge for water on a non-linear scale, like taxes.

Yes? I was answering your question of why to do that.

Re: Why districts are slow to charge market rates for water (2009)

#63

Post by eru » Tue, May 23, 2023, 2:08 AM UTC

AuthorizedCust wrote: post #52

eru wrote: post #16

Earlier quoted context omitted.

Sounds like you just need different prices in different times of the year? Just like electricity often has different prices during different parts of the day?

Or different pricing when there’s an actual need to conserve, which isn’t always seasonal.

Yes, indeed. Seasonality was just an example.

Re: Why districts are slow to charge market rates for water (2009)

#64

Post by matthewterhune » Tue, May 23, 2023, 5:29 AM UTC

pvdoom wrote: post #54

rocqua wrote: post #43

Earlier quoted context omitted.

They should, because water is scarce. Like the article says, have a low rate for an amount that covers basic needs. But raise rates for usage above that. Discourage fountains wasting water. Ideally (though it won't happen probably) make farmers pay higher rates for the water they use.

Problem is, especially when a resource is scarce, markets are pretty bad, even worse than distributing things under normal conditions.And farming pretty much needs water, so increasing prices of water for farming means increasing food prices. So you will still end up with rich people watering their lawns, but people with less income will have to suffer. I think this is better handled through heavy taxation and outrig…

It means increasing food prices specifically for foods that require extensive irrigation, and are likely ill-suited for the region they are being grown except for water subsidies, e.g. almonds in California. So it means shifting agriculture towards more sustainable crops, increased prices for some specific foods, and likely reduced water prices for the average consumer.

Re: Why districts are slow to charge market rates for water (2009)

#65

Post by pvdoom » Tue, May 23, 2023, 7:30 AM UTC

matthewterhune wrote: post #64

pvdoom wrote: post #54

Earlier quoted context omitted.

Problem is, especially when a resource is scarce, markets are pretty bad, even worse than distributing things under normal conditions.And farming pretty much needs water, so increasing prices of water for farming means increasing food prices. So you will still end up with rich people watering their lawns, but people with less income will have to suffer. I think this is better handled through heavy taxation and outrig…

It means increasing food prices specifically for foods that require extensive irrigation, and are likely ill-suited for the region they are being grown except for water subsidies, e.g. almonds in California. So it means shifting agriculture towards more sustainable crops, increased prices for some specific foods, and likely reduced water prices for the average consumer.

I think that the agriculture thing is again better achieved with regulation, rather than a magical market fairy.

Re: Why districts are slow to charge market rates for water (2009)

#66

Post by rocqua » Tue, May 23, 2023, 8:50 AM UTC

pvdoom wrote: post #54

rocqua wrote: post #43

Earlier quoted context omitted.

They should, because water is scarce. Like the article says, have a low rate for an amount that covers basic needs. But raise rates for usage above that. Discourage fountains wasting water. Ideally (though it won't happen probably) make farmers pay higher rates for the water they use.

Problem is, especially when a resource is scarce, markets are pretty bad, even worse than distributing things under normal conditions.And farming pretty much needs water, so increasing prices of water for farming means increasing food prices. So you will still end up with rich people watering their lawns, but people with less income will have to suffer. I think this is better handled through heavy taxation and outrig…

Markets only make sense when a resource is scarce.

Tweaking the market and exemptions might be difficult and finicky. But managing taxation and outright bans is even more finicky.

I am not, btw, arguing for an electricity like system of daily auctions. Just for a 2-tier pricing system that covers the basic requirements with a low rate, and sets a roughly 'market clearing price' for the remainder.

For this I would also price untreated water quite a bit higher. The price isn't just set for the cost of extraction. It is mainly set for the opportunity costs of all others who cannot use that water. So untreated water should cost roughly the same.