Содержание
- 2. Maximized total benefit Recall: Adam Smith’s “invisible hand” of the marketplace leads self-interested buyers and sellers
- 3. EXTERNALITIES AND MARKET INEFFICIENCY An externality refers to the uncompensated impact of one person’s actions on
- 4. EXTERNALITIES AND MARKET INEFFICIENCY An externality arises... . . . when a person engages in an
- 5. EXTERNALITIES AND MARKET INEFFICIENCY When the impact on the bystander is adverse, the externality is called
- 6. EXTERNALITIES AND MARKET INEFFICIENCY Negative Externalities Automobile exhaust Cigarette smoking Pollution Loud stereos in an apartment
- 7. EXTERNALITIES AND MARKET INEFFICIENCY Positive Externalities Immunizations Restored historic buildings Research into new technologies
- 8. The Market for Aluminum Quantity of Aluminum 0 Price of Aluminum
- 9. EXTERNALITIES AND MARKET INEFFICIENCY Negative externalities lead markets to produce a larger quantity than is socially
- 10. Welfare Economics, An example The Market for Aluminum The quantity produced and consumed in the market
- 11. Welfare Economics: An example The Market for Aluminum For each unit of aluminum produced, the social
- 12. Pollution and the Social Optimum Copyright © 2004 South-Western Quantity of Aluminum 0 Price of Aluminum
- 13. Negative Externalities The intersection of the demand curve and the social-cost curve determines the optimal output
- 14. Negative Externalities Internalizing an externality involves altering incentives so that people take account of the external
- 15. Negative Externalities Achieving the Socially Optimal Output The government can internalize an externality by imposing a
- 16. Positive Externalities When an externality benefits the bystanders, a positive externality exists. The social value of
- 17. Positive Externalities A technology spillover is a type of positive externality that exists when a firm’s
- 18. Education and the Social Optimum Copyright © 2004 South-Western Quantity of Education 0 Price of Education
- 19. Positive Externalities The intersection of the supply curve and the social-value curve determines the optimal output
- 20. Positive Externalities Internalizing Externalities: Subsidies Used as the primary method for attempting to internalize positive externalities.
- 21. PRIVATE SOLUTIONS TO EXTERNALITIES Government action is not always needed to solve the problem of externalities.
- 22. PRIVATE SOLUTIONS TO EXTERNALITIES Moral codes and social sanctions Charitable organizations Integrating different types of businesses
- 23. The Coase Theorem The Coase Theorem is a proposition that if private parties can bargain without
- 24. Why Private Solutions Do Not Always Work Sometimes the private solution approach fails because transaction costs
- 25. PUBLIC POLICY TOWARD EXTERNALITIES When externalities are significant and private solutions are not found, government may
- 26. PUBLIC POLICY TOWARD EXTERNALITIES Command-and-Control Policies Usually take the form of regulations: Forbid certain behaviors. Require
- 27. PUBLIC POLICY TOWARD EXTERNALITIES Market-Based Policies Government uses taxes and subsidies to align private incentives with
- 28. PUBLIC POLICY TOWARD EXTERNALITIES Examples of Regulation versus Pigovian Tax If the MEP decides it wants
- 29. PUBLIC POLICY TOWARD EXTERNALITIES Market-Based Policies Tradable pollution permits allow the voluntary transfer of the right
- 30. The Equivalence of Pigovian Taxes and Pollution Permits Quantity of Pollution 0 Price of Pollution (a)
- 31. Figure The Equivalence of Pigovian Taxes and Pollution Permits Quantity of Pollution 0 (b) Pollution Permits
- 32. Summary When a transaction between a buyer and a seller directly affects a third party, the
- 33. Summary Those affected by externalities can sometimes solve the problem privately. The Coase theorem states that
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