Slide 1 EXTERNALITIES Chapter 5 Slide 2 Externalities Externality – An activity of one entity that affects the welfare of another entity in a way that is outside the market…
Slide 1 The economics of externalities Today: Graphical analysis Private responses Public responses Slide 2 Today More on the externality problem Marginal damage will…
Slide 1 More on taxation Today: Studying taxation graphically What should be taxed? Why? Slide 2 Changes in consumption due to taxes Recall that people typically consume…
Slide 1 More on externalities Today: Positive externalities Highway congestion Problems Who is this? (Answer later) Slide 2 Previously: Introduction to externalities Markets…