ECN 340 Lecture Notes - Lecture 2: Marginal Cost

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*anything worth doing may not be worth doing well! *people do things less well because of the added (marginal) cost. *writing a c paper is less costly than writing an a paper. *young"s bene ts larger-gains for long period of time. *grass may be a short cut thus can bring bene ts. *marginal cost (mc) is close to zero if the path is already there. *most people think that if they alone walk on the grass, the marginal cost(bad cost) will be close to zero. *thus, a path in the grass is created without anyone wanting it. *it occurs because each person believes the mc they contribute is low (if only i do it, it doesn"t matter) * polluting may be rational if others behaviour cannot be controlled - escalation can occur. *in all these cases the individual thinks about the potential costs and bene ts to himself/ herself and acts accordingly.

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