Trains, Planes, and Perverse Incentives

Recently, Dane and I have been discussing what role economics should play in framing climate change. Personally, I believe that we shouldn't be framing things solely in economic terms, but that we need to be cognizant of people's welfare.

However, that does not mean that economics doesn't have its place. It definitely does. And its never more evident how important economics is as when you are planning a little trip over Spring Break.

See, I am planning on spending a few days in Paris and Nice during my vacation. Because I am trying to be an ethical consumer, I decided to buy a train ticket. So I purchased one for about 100 Euros, and the trip will take me 10 hours.

Now, I was willing to do this because I like train rides, and it's an overnight train ride, so I'll actually get to sleep and save myself money on accommodation that night.

But, how much would it have cost me to fly? Well, I did some looking, and it looks like I could have flown from Paris to Nice for the same price, and gotten there much, much faster.

And that's a problem. Because as long as flying is the cheapest and fastest way to get around the Continent, that's what people are going to do. That's why economic solutions are sometimes necessary to get rid of these perverse incentives that encourage us to choose less efficient modes of transport than others.