3.1.5.4 Positive and negative externalities in consumption and production Flashcards Preview

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Flashcards in 3.1.5.4 Positive and negative externalities in consumption and production Deck (2)
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1

What is a negative externality?

Divergence between private and social costs e.g. driving causes congestion and pollution.

2

What is a positive externality?

Divergence between private and social benefits e.g. consumption of solar panels.