This is a Lamborghini Contach, bask in it's magnificence! When I whizz past you in my Lambo taking the kids/kid (the other two can walk) to school I get the benefit of going from A to B and looking spectacular. You on the other hand get to inhale the noxious fumes and suffer a cost which could eventually be something serious like dying early. The social cost to me driving has a social cost that I don't have to pay and it's called a negative externality. Unless the government does something I never have to pay the full cost of driving my fancy car, woohoo for free markets. Some would even argue that I'm providing a positive externality because you get to see my beautiful car.
Climate Change
Climate Change
Climate Change
This is a Lamborghini Contach, bask in it's magnificence! When I whizz past you in my Lambo taking the kids/kid (the other two can walk) to school I get the benefit of going from A to B and looking spectacular. You on the other hand get to inhale the noxious fumes and suffer a cost which could eventually be something serious like dying early. The social cost to me driving has a social cost that I don't have to pay and it's called a negative externality. Unless the government does something I never have to pay the full cost of driving my fancy car, woohoo for free markets. Some would even argue that I'm providing a positive externality because you get to see my beautiful car.