Essay On Negative Externalities

When discussing externalities in general terms, positive externalities refer to the benefits and negative externalities refer to the costs associated with the production or comumption of a good or service. Negative externalites cause too much of a product to be produced and positive externalities cause too little of a product 's production.
Positive externality
i. A company provides funds for it 's employees to obtain specialized training or degrees. By doing so, the company can be benefited by increased production which also benefits the customer. At the same time, this can benefit society as a whole by increasing the level of education, quality of life, etc. ii. Significant home improvements will not only raise a person 's property value, but it will also

iii. Second-hand cigarette smoke causes health problems in people other than smoker.
Discuss how they may impact society
Public goods are goods which are difficult to exclude people from benefiting from or from getting a free ride. Public goods, such as national defense, clean water, clean air, law enforcement, etc., are generally good for most, if not all of society.
Negative externalities exist in many situations. One of the most common examples is that of pollution. In these situations, the producer and consumer finance the goods produced but society must bear the cost of pollution that is introduced into the environment as a by-product and is thus a negative externality. For example, a factory that produces widgets generates a hazardous by-product from the widget production process. It dumps the by-product in neighboring stream. The more widgets produced, the more by-product is produced and thus the more pollution that goes into the water. In this situation and in the event of the absence of well defined property rights there may be an issue of how much pollution may be dumped into the water or if it can be dumped into the water at all plus an issue over who is responsible for the cost of the