A cultural predisposition has economic value. We should try and calculate it in order to be able to assess the benefits of investing in cultural change.
Reflecting on the Californian drought, I imagined a people which is thrifty with water and another which is profligate with water.
The one people has built into its culture a preference to save water: collect grey water and rain water, use it sparingly and carefully, do without products with a high water footprint.
The other people doesn’t give a toss and uses lots of water on emerald green, glistening lawns.
Then you get a mega drought.
There is less economic damage to the culture which is thrifty with water – with fuller reserves and a lower need for water, it is more resilient. That resilience has economic value: its GDP will be less affected than the GDP of the water wasting culture.
The impact on the economy of the severe drought is a function of the cultural attitude to water. You can consider the cultural attitude to water as being an asset – a social asset – which has a value.
It would be important to understand the value of that asset and the cost of building and maintaining it. The economic return on building this asset might be greater than the economic return of moving populations elsewhere, redirecting rivers or drilling ever deeper into ancient, underground reserves. Numbers would help us to judge the wisdom or otherwise of the different approaches available.
This obviously needs more thought. Surely a job for the Centre for Belief Economics.