ABSTRACT
A good measure of world resource use world output of goods and services has increased approximately 4 percent per year since 1950 while population has increased approximately 2 percent per year. This chapter argued that most of the detrimental environmental effects of human activity result from externalities, that is, situations in which the benefits and costs of decisions are not received or borne by the decision maker. It examines two examples of the environmentally dysfunctional character of the way to make decisions regarding population and resource use. The first case is that of the Himalayan watershed, which is among the economically least developed areas of the world and is subject to burgeoning population pressure. The second case is the airshed of the North American industrial midlands and Northeastern coast, which is shared by Canada and the United States. This area exemplifies the highest level of economic development and population pressure due to urbanization.
