The Price of Everything

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“According to Eduardo Porter of The New York Times editorial board, prices are more interesting than most of us realize. And the prices that never appear on a price tag are the most fascinating of all. In his new book The Price of Everything: Solving the Mystery of Why We Pay What We Do (2010, Portfolio), Porter explores the surprising ways prices affect every aspect of our lives, including where we live, who we marry, how many kids we have, and even how religious we are.”

Here is the introduction to Porter’s book.

PRICES ARE EVERYWHERE

Anybody who has visited a garbage dump in the developing world knows that value is an ambiguous concept. To most people in the developed world, household waste is worthless, of course. That’s why we throw it away. Apparently, Norwegians are willing to pay about $114 a ton for somebody else to sort their recyclables from the general garbage. A survey of families in the Carter community of Tennessee several years ago found they were willing to pay $363 a year, in today’s money, to avoid having a landfill nearby.

But slightly beyond our immediate experience, waste becomes a valuable commodity. In Kamboins√©, outside Ouagadougou, Burkina Faso, farmers pay municipal trash haulers to dump unsorted solid waste on their sorghum and millet fields as fertilizer — bits of plastic included. The going rate in 2003 was 400 francs per ton. In New Delhi, a study in 2002 found that waste pickers earned two rupees per kilo of PET soda bottles and seven rupees per kilo of hard plastic shampoo bottles. A child working on foot on Delhi’s dumps could make twenty to thirty rupees per day.

Waste, in fact, confronts us with the same value proposition as anything else. The price we put on it — what we will trade to have it, or have it go away — is a function of its attendant benefits or costs. A bagful of two-rupee PET bottles is more valuable to an Indian child who hasn’t eaten today than to me, a well-fed journalist in New York. What she must do to get it — spend a day scavenging among the detritus of India’s capital, putting her life and health at risk — is, to her, not too high a price to pay because life is pretty much the only thing she has. She has little choice but to risk it for food, clothing, shelter, and whatever else she needs. I, by contrast, have many things. I have a reasonable income. If there’s one thing I have too little of, it is free time. The five cents I could get for an empty PET bottle at the supermarket’s recycling kiosk are not worth the trouble of redeeming it.

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