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Which is an acceptable market method of regulating negative externalities?
Wiki User
∙ 13y ago
cost benefit analysis which is the procedure by which a government decides whether to go ahead with a project after factoring in all the costs and benefits, both private and external is a good method of regulating negative exsteralites
Wiki User
∙ 13y ago
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When are negative externalities present?
when there has been a market failure
How do externalities cause market failure?
Externalities can cause market failure if the full social costs and social benefits of production and consumption are not taken into account.
What are the factors responsible for market failure?
- Negative Externalities - Public Goods - Common Property - Collective action and that's as far as my help goes bro, I have an exam to study for.
What is the economic term for the indirect effects of markets that are not corrected within the markets?
Externalities. A more proper definition for an externality is a transaction between two economic agents which affects a third, non-participating agent. Whether or not externalities are corrected for in a market is a matter of debate in economic theory.
Disadvantages of market mechanism?
it does not take into account market power, public goods, merit goods and externalities. it works in a free market and not in a controlled one.
When are negative externalities present?
when there has been a market failure
How do property rights affect externalities and market failure?
Externalities and market failure will result from the difficulty of enforcing property rights.
What do you understand by the term externalities and how can it be corrected in Nigeria economy?
Externalities is the positive (or negative) effect to the society due to consumption (production) of a good by an individual.The answer assumes that the externality in which Nigeria is facing is a negative externality. Ways to correct negative externalities are:Taxation: By increasing tax, we discourage production of such good, reducing negative externalitiesNegative advertising: similarily, this method aims to reduce demand for the said goodTradable permit: The best example for this is the "Cap 'n' Trade" scheme used by the United States government. This aims to reduce the amount of negative externalities year by year.Banning of that good: One can ban the production of that good and make it illegal (drug.) However, this is likely to create a parallel market (black market)
When externalities are present?
when there has been a market failure
How do externalities cause market failure?
Externalities can cause market failure if the full social costs and social benefits of production and consumption are not taken into account.
What are the factors responsible for market failure?
- Negative Externalities - Public Goods - Common Property - Collective action and that's as far as my help goes bro, I have an exam to study for.
In the absence of externalities the middle hand leads a market to maximize?
total benefit to society from that market
What is internalizing negative externalities?
From Wikipedia article titled "Externality":There are a number of potential means of improving overall social utility when externalities are involved. The market-driven approach to correcting externalities is to "internalize" third party costs and benefits, for example, by requiring a polluter to repair any damage caused. But, in many cases internalizing costs or benefits is not feasible, especially if the true monetary values cannot be determined.
What is negative externalities?
From Wikipedia article titled "Externality":There are a number of potential means of improving overall social utility when externalities are involved. The market-driven approach to correcting externalities is to "internalize" third party costs and benefits, for example, by requiring a polluter to repair any damage caused. But, in many cases internalizing costs or benefits is not feasible, especially if the true monetary values cannot be determined.
What is the economic term for the indirect effects of market that are not corrected within the markets?
Externalities
What is the economic term for the indirect effects of markets that are not corrected within the markets?
Externalities. A more proper definition for an externality is a transaction between two economic agents which affects a third, non-participating agent. Whether or not externalities are corrected for in a market is a matter of debate in economic theory.
Disadvantages of market mechanism?
it does not take into account market power, public goods, merit goods and externalities. it works in a free market and not in a controlled one.
