Quote:
Originally Posted by Jim Richards
The good thing about your post is that you, as the student, use your own brain to evaluate what you're being taught. Your profs and TAs have their own biases on the subject, and of course, so will you after you've thought it over. It's good that you're not a mindless robot, following anything and everything the profs say. Even if you're wrong!  |
Nevar! Multi-period graphs, in some applications, are used to evaluate mine production. In theory, say we can remove an entire natural resource in a given year, a small coal mine, but instead an artificial constraint is imposed to prevent this. I'll call this the "environmental" constraint
. From a pollution standpoint say we want the mine to last X number of years or we only want Y amount of coal to be utilized for the environments sake. This constraint has no monetary value. It's based entirely on quantity. Plus you can establish coal production itself as a bad after a certain point. Arbitrary values are used in the calculations, but it never becomes a monetary matter.
Another similar case, Multi-agent graphs for constrained allocation. Some examples; the allocation of water in California between agriculture and cities, and the in-stream flows for fish to aquatic habitats. Again, ignoring monetary values
.
Last one! The famous use of carbon credits... Carbon credits can be given to countries that are rich in natural resources, like timber, to account for the amount of carbon removed from the atmosphere by their trees. These credits should discourage further deforestation because the trees now posses some kind of value beyond their timber. The credits can then be traded by the forested country to industrialized countries, that tend to pollute more, in return for money, debt reduction, or even Food Aid (why not?).
In a lot of cases a strict monetary value is not necessary. The professor was implying that the lack of a monetary value on natural capital results in no value being placed on that capital at all. Not true! Limitless resources? Also not true!