Free as the air? In HK we pay through the nose to breathe
Elsewhere in the world people say the air is free. But not in Hong Kong. Here, if you want to breathe good-quality air, moderately free from pollution, then you have to pay for the privilege.
I'm not talking here about paying through the nose for a whiff of pure oxygen in an over-designed health 'bar', although you can do that if you want to.
Nor am I talking about equipping your domestic air-conditioning system with expensive electrostatic scrubbers or zeolite filtration devices, although there are plenty of people willing to sell those to you.
No, as you would expect in Hong Kong, if you want to breathe clean air, then the extra costs are hidden away in our high property prices.
In one sense this is obvious. The air in Repulse Bay is considerably fresher than in Causeway Bay, and the prices of flats are stratospherically higher.
However, differing pollution levels don't just contribute to differences in property prices between districts, they can also cause big differences in the same neighbourhood.
That allows us to put a price on clean air.
In a recent study, researchers from the University of Hong Kong used techniques borrowed from three-dimensional fluid dynamics to simulate the dispersion of PM10 pollution particles around a small area of Mong Kok.
This allowed them to model air quality right down to the level of individual flats in 24 apartment buildings.
The differences in PM10 concentrations between flats were enormous, ranging from zero to 723 micrograms per cubic metre. To put that last figure into perspective, it's more than twice as polluted as Beijing on a bad day.
The average level was 146mcg/cubic metre, or three times as high as the World Health Organisation's air quality target.
Next, the researchers took property transaction data for the area, and corrected sales prices for building age, flat size, and floor height, which allowed them to calculate the premium property buyers in Mong Kok are prepared to pay for flats with cleaner air.
For an averagely priced flat with average pollution levels, they found that buyers were prepared to pay an extra HK$4,800 for each reduction of 100mcg/cubic metre in the PM10 concentration. That was at 1999 property prices. Today the clean air premium would work out at about HK$9,000.
However, the higher the pollution level, the more buyers were willing to pay. At a pollution level of 500mcg/cubic metre, the clean air premium soared to HK$70,000, or roughly HK$130,000 at today's prices. That's equal to more than 4 per cent on the property price.
The researchers also found that the more expensive the flat, the more buyers were prepared to pay for high-quality air.
This tendency has clear implications: poor families are less able to afford clean air. As a result, concluded the researchers, 'lower income households are more likely to live in housing units with lower air quality and suffer from health problems'.
So there you have it: in Hong Kong not even the air is free, and as usual it's the poor who end up paying the highest price.
Witch-hunts are a form of mass hysteria, and in the case of Barclays emotions seem to have prevented a sober assessment of whether the bank really did manipulate the benchmark Libor interest rate during the 2008 financial crisis.
A look at the numbers indicates it didn't. Throughout the crisis Barclays consistently reported that other banks were demanding high interest rates to extend it loans; hardly surprising given Barclays' eagerness to buy up distressed assets like Lehman Brothers.
As a result, as the charts illustrate, Barclays' Libor submissions were much higher than average; so high, in fact, that they were excluded from the benchmark's calculation.
If any banks were manipulating the interest rate during the depths of the crisis, Barclays wasn't among them.