Economics Dictionary of ArgumentsHome
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| Externalities: Externalities are unintended side effects or consequences, positive or negative, of economic activities impacting third parties not involved in the transaction. They occur when the actions of individuals or businesses generate spillover effects on others' welfare or resources, without compensation. Examples include pollution affecting communities or innovations benefiting industries beyond the innovator. See also Compensation, Economy._____________Annotation: The above characterizations of concepts are neither definitions nor exhausting presentations of problems related to them. Instead, they are intended to give a short introduction to the contributions below. – Lexicon of Arguments. | |||
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Harold Demsetz on Externalities - Dictionary of Arguments
Mause I 157 Externalities/Demsetz: External effects (influencing the market by decisions of the uninvolved) cause costs for the procurement of information and time for negotiations. Money: Under these circumstances, the implementation of the exclusion principle will have to satisfy a rational cost-benefit consideration - rational individuals will only enforce the exclusion of third parties, that are unwilling to pay, to the extent that their net benefit is positive, so that it can be expected that there will always be an optimal degree of externality that will be below the full internalisation of the external effect. (1) 1. H. Demsetz, Toward a theory of property rights. American Economic Review 57 (2), 1967, p. 347-359._____________Explanation of symbols: Roman numerals indicate the source, arabic numerals indicate the page number. The corresponding books are indicated on the right hand side. ((s)…): Comment by the sender of the contribution. Translations: Dictionary of Arguments The note [Concept/Author], [Author1]Vs[Author2] or [Author]Vs[term] resp. "problem:"/"solution:", "old:"/"new:" and "thesis:" is an addition from the Dictionary of Arguments. If a German edition is specified, the page numbers refer to this edition. |
EconDems I Harold Demsetz Toward a theory of property rights 1967 Mause I Karsten Mause Christian Müller Klaus Schubert, Politik und Wirtschaft: Ein integratives Kompendium Wiesbaden 2018 |
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> Counter arguments against Demsetz
> Counter arguments in relation to Externalities
