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Giving someone a lift – whats the worst that could happen?
At the risk of boring you to tears with my first sentence, I’d like to tell you about my second favourite economic concept (conversely I’ll keep you on the edge of your seat for a bit before I tell you my first) which is the “opportunity cost” of things. That is to say the thing that could have happened or one could have had if one hadn’t done what they did. Why? Because, this week I was asked to help raise awareness of National Liftshare Day (which is on the 9th of June) by Liftshare and the first thing that sprang to my mind was the opportunity cost of giving someone a lift.
On my own in a car I can listen to the music I want, get on the road without having to wait for someone, be silent without feeling awkward, sing as loud as I like – so the opportunity cost to me of giving a lift is exactly that I can’t do these things (or, at least, not without some embarrassment). They would seem to be rather flimsy penalties suffered in return for giving a lift. And looking at it from other side of the fence – i.e. the cost of not giving someone a lift – we have one more (or several if it’s a multi-person lift) car on the road, greater carbon emissions, more traffic… maybe even the loss of some profit in the form of a greater-than-the-actual-cost contribution towards the fuel!
Giving the lift, it seems, has by far the lower opportunity cost.
Much more recently than my economics lessons at school (last week in fact) I learnt another economic term – something called “positive externalities”. A positive externality is when a transaction takes place and other profitable or good things happen as a result. An example could be that a bee keeper keeps bees to produce honey – the positive externality is that they pollinate through their activity all the flowers and crops in the surrounding area. The beekeeper’s reason (reason is the important bit to distinguish) is to profit from the honey, as a result, it seems, everyone around him gets a favour too. Applied to whether one does or doesn’t give someone else a lift – there are many externalities that feel pretty positive to me.
Let’s say, for the sake of argument, that my reason for giving someone a lift is in pursuit of a contribution towards my fuel costs. One of the positive by-products is that I will keep another car off the road. This in turn will reduce carbon emissions and reduce traffic. This in turn will have a slightly less negative effect on the environment
and hopefully the stress levels of some of my fellow drivers. All of which sound pretty positive to me. I think we can safely assume two things – one, that the cost of not giving someone a lift produces the opposite effects – i.e. negative externalities – and two, the concept of positive externalities has risen to third place (at least for now) in my personal chart of favourite economic theories.
Which brings me neatly on to my favourite economic theory – that we live in a state of “imperfect information”. Since we do not know everything all of the time there is a kind of drag placed on the efficiency of all exchange – and that drag means that the plight of all people trying to do “business” is simply to “add value” which is nearly always done by simply improving or directing the flow of information. So how does that relate to lift-sharing? Well, if we all knew who wanted to go where all of the time it would be very easy to match up who should be giving lifts to whom. But we don’t know – and very often we don’t even know what our closest neighbours are doing and when the opportunities to double up on a trip might be possible. It would be fair to conclude that all we have to do then to create lift share opportunities is improve our flow of information and act on the back of it.
Between now and the 9th of June, if you are interested in taking part in National Liftshare Day, find out to whom you could offer a useful lift. And then actually do it! I may be wrong, but I suspect we may all surprise ourselves with the opportunities that are closer to hand than we think. What’s the worst that could happen?
Schmeditor
PS – Here comes my weekly roundup…

PICKS FROM THE MARKET
This Fair Earth – an Ostrich Shell Bangle and a Fuschia Chain Bracelet
Purity – Tops and Tees!
Naturalhome Products – Summer Duvets and Organic Pillows
The Africa House – Dark Red Silk Shange Necklace and a Fairly Traded Elephant Tea Cosy
Well Cultivated – Eco Shopping Bag and Bamboo TShirts
EcOutlet – fantastic Outdoor Solar Fairy Lights
Energise Your Life – a juicer for these hot days!
PeopleTree – a beautiful Poplin cotton skirt

PICKS FROM THE PULSE
The South Woodford Business Partnership London are looking to hold a Green Market in the town centre on Saturday 18th July 2009. If this Green Market is successful further markets will take place. Places for the market are limited and will be issued on a first come first served basis. If you are a green/ethical trader and are interested in having a stall/gazebo please contact James Fry at info@organicalife.co.uk
Eco-print launch straw paper
Eco-friendly Sun Loungers from Bambienti
Lands End to John O’Groats
Discover your inner beauty with Fushi
Warren Evans named in Sunday Times Green List
See you next week…
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