ECON 2D03 Lecture Notes - Lecture 2: Chlorofluorocarbon, Externality, Global Warming
Document Summary
Air pollution: carbon monoxide, sulfur oxides, nitrogen oxides (motor vehicles; industrial plants) Global warming: carbon dioxide (burning of fossil fuels) Damage to the ozone layer: chlorofluorocarbons (cfcs) Industrial wastes, leaking septic tanks and landfills, pesticides. Environmental damage: harmful by-product of economic activity. Externality: the cost or benefit of an economic activity that spills over onto the rest of society, examples, education. Inequity: negative externalities, shift costs to groups that did not incur them, positive externalities, shift benefit groups that did not earn them. Inefficiency: negative externalities, we produce and consume too much of a product, over allocate resources to its production, positive externalities, we produce and consume too little of a product, under allocate resources to its production. Effects of pollution from one market onto another market.
