- Dalia Ventura
- BBC World News
History has shown us that often not even the best intentions accompanied by seemingly good ideas ensure a happy ending and that, in many cases, saying that “the intention is what counts” is not enough.
Think, for example, of one of the measures that various cities around the world have taken over the years to deal with the problem of environmental pollution.
The case of Mexico City may be familiar to you.
In the late 1980s, the rulers of the metropolis, whose air quality was so worrying that it was described as “the prelude to an ecological Hiroshima”, they decreed that every winter day -when the pollution is worst- 20% of the cars could not circulate.
What determined which vehicles were immobilized were the last digits on the license plates.
The program known as “Hoy no circula” came into force on November 20, 1989 with two clear purposes:
- Reduce alarming levels of pollution
- Reduce vehicular traffic
The Mexican capital has the Mexico City Atmospheric Monitoring System that reports air quality according to an index called IMECA (the acronym for Metropolitan Air Quality Index).
The IMECA uses 5 categories that reach “extremely bad” when it exceeds 200 points.
Well, in 8 days of 1991 and 11 days of 1992, with the program “Hoy no circula” already in effect, they reported the levels pollution most critics historically recorded with values of 300 points.
And it turns out that the needs of people don’t change on government orders.
As much as the population wanted cleaner air, they also needed to get to work, go to school, and so on.
So the reaction to “Today is not circulating” was not what legislators anticipated: although some did share cars or travel by public transport, as expected, others took taxis, which were more polluting than average cars.
Not only that: there was a group that bought another car and, in many cases, that second vehicle was of poorer quality and therefore was throwing pollution into the air of the city at a much higher rate.
Era the opposite of the two purposes of “Hoy no circula”.
Of course that was not the end of the story: the program was modified and is still standing today.
But this first phase is not only an example of those unintended consequences so common in life (and the economy), but also of a specific type of them: those that occur when the proposed solution ends up worsening the problem that was intended to be solved.
It is not simply a surprise negative result, it is the opposite of what was intended.
The phenomenon is sometimes baptized with the term “perverse incentives” But economists have another name for that kind of even more resounding unintended consequence: the eOf course Cobra.
The term was coined by the German economist Horst Siebert in his 2001 book of the same name, inspired by an episode that occurred in India when it was still “the jewel in the crown of the British Empire.”
Its capital, New Delhi, suffered from an infestation of cobras, a problem that clearly needed a prompt solution since, among other things, it could be fatal.
The colonial government came up with a solution: offer a generous reward for every dead cobra that the people turned over.
The offer caused a hunt that effectively reduced the number of those poisonous snakes.
Only, after a while, there was something that began to miss the authorities. Cobras were no longer seen gliding through the city, yet they continued to pay as many or even more rewards.
What had happened is that when it became more difficult to find snakes in the city, people became more enterprising.
They began to raise them in their homes, so they could kill them and continue receiving the money that the government offered.
When the authorities found out what was happening, they suspended the incentives.
As the snakes were worthless, the breeders released them and Delhi was once again overrun by the dangerous snakes … only in higher numbers.
Doesn’t it sound like one of those stories told to teach a lesson?
The moral: linear thinking is limited and you should never underestimate the complexity of a system or human ingenuity.
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