The Sky is the Limit?
Recently I have learned that the sky is no longer the limit. Air (space) is being traded between large companies in New York City. The space above skyscrapers is limited, so particular restrictions have been placed on the height of buildings in that area. Also, with regards also to the pollution rights that are being traded, there is money to be made and lost in new markets. My economic take is that these rights, which on the surface appear to be different, are actually a good thing. I would just like to make one point on the particular subject of selling rights, more especially for small businesses who are barely making it. One example that I read, was a small business who was asked to cut back it's level of pollution production by X amount over the next couple of years. In order to meet these demands the small company will need to invest a large amount of money in scrubbers that will clean up the pollution being released by the company. It could not afford this type of investment on its own; however, because it had extra pollution credits it was able to sell these credits to a larger company that needed more pollution rights. I see these markets as helping the smaller businesses to become more competitive. It helps in this way, to level the playing field a little more and offer more investment opportunities to these smaller companies who would not have the opportunity otherwise.