4 Mar 2014

People offered free train trips to escape smokes

Stone Jin writes:*

The Hazelwood mine in the Latrobe Valley has been burning for around 3 weeks, it blanketed Morewell with falling ash and smoke. Thousands of people living there waiting to escape were offered with free train tickets.

Obviously the coal mine fire causes huge negative social effects to the society, in short long people's regular life is ruined, and their health faces threat by ash and smoke emissions. Specifically, the smoke will rise of lung disease incidence rate. In long run, the fire will bring a great harm to the reginal economic. The state public transport minister, Terry Mulder said the offer of free train tickets to anywhere in Victoria is an good gesture to help people escape the smoke. Under this circumstance, the free train tickets can be regarded as common goods. Everyone will have the free ticket in the end, but those who waiting longer will be more suffered by the pollution. The extra train arrangement will also affect the transport around the area.

With the respect of the Hazelwood mine owner, GDF Suez Australian Energy, it has responsiblity to do the damage compensation indeed. The morewell residents are considering to sue GDF Sues Australian Energy. Besides the residents harm, death and health problems, the damage to those business which depending on nature condition can't be ignored(farmers, herdmen). Meanwhile even the public transport officer announced to offer people with free train tickets, the benefits go the residents living nearby. Consequently company may have partial obligation payment for the free train tickets. Last but no least, there's another problem which is the social transaction cost to deal with the fire (how to minimize the cost to control the fire).

Bottom Line: In conclusion, the fire brings huge negative social effects to this area. It hurts both the market economy and the utilization of natural resources in Australia.

* These guest posts are from students in my resource economics class at Simon Fraser University. Please leave feedback on their logic, ideas and style and suggestions of how to improve.