Economic Externalities

Externalities.
Anthony Glew


Externalities are unintended spillovers or side effects that result from production or consumption. They affect others (third parties) not directly involved in the production or consumption process. An example of this is an 18-year-old male who on a Saturday night goes to the pub for a few drinks. Instead of having just a few drinks he ends up having a dozen pints of beer in only 2-3 hours. As a results the male is now uncoordinated and cannot walk straight let alone be in command of a motor vehicle. Ho...