The two industries I chose to show examples of negative and positive externalities are Phillip Morris International and the Southwest Airlines. The negative externalities are from the Phillip Morris articles in relation to second hand smoke and health costs associated with smoking. There is over 60 billion spent in health costs. There are 35 billion in medical expenses‚ 20 billion from missed time at work and 5 billion in related fires‚ smoke‚ and odor damage. These are not only for the people that
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Course: IB Economics SL Commentary number: 1 School name: Candidate name: Candidate number: Date commentary was written: 24 May 2014 Section of the syllabus to which the commentary relates: Section 1 – Microeconomics Word count: 745 Source of extract: Richard J. Brennan‚ Published on Thu May 01 2014‚ Tax on cigarettes going up http://www.thestar.com/news/queenspark/2014/05/01/tax_on_cigarettes_going_up.html Article: Tax
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Say No To Plastic Bags Plastic is a material that we can see everyday everywhere in our life‚ people all over the world are using plastic bags to carry something or other things and. Plastic bags are extremely dangerous for environment ‚ it is one of the main problem why environment in the world is becoming worst . Plastic bags are non-biodegradable ‚ it means that plastic bags cannot be turned into any other substance that benefiting environment . Even though plastics are being burned ‚ it will
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The Coase Theorem Michael M. Reynolds Grantham University Abstract Ronald Coase received the Nobel Prize in 1991 for his discovery and clarification of the significance of ("Coase theorem‚" ) transaction costs and property rights for the institutional structure and functioning of the economy. Coase writes ("Coase theorem‚" ) two articles in particular: “The Nature of the Firm’ (1973)‚ which introduces the concept of transaction cost to explain the nature and limits of firms and “The Problem
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First let’s define externality: Definition of ’Externality’ A consequence of an economic activity that is experienced by unrelated third parties. An externality can be either positive or negative. (Ref: www.investopedia.com) As an example of the above definition: Pollution from a factory can affect the health of nearby residents – negative The same factory can provide jobs to nearby residents – positive Negative externality is two part: production and consumption. I will be using both
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Use of Plastic bags Modern science has helped us in making our lives more comfortable and easy. It has given us everything and more than we wanted. Plastics are one of the greatest inventions of modern science. Plastics play a major role in our lives. The inventors of it little knew about it’s harmful consequences that we are facing now as they thought it to be a boon to mankind. Today they are a great threat to the environment. Everywhere around us we find plastic bags as a carrier of all kinds
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Charging for Plastic Bags Nowadays‚ many billions of plastic bags have been using every year‚ and it seems to be increased more and more. According to Noland (2013)‚ in the UK‚ the number of plastic has risen up to 5.4% in 2010 to 2011. Another statistic illustrates that 90 percent of plastic bags do not be reused or recycled (Bobby‚ 2013). This shows that people do not care much about the effect of plastic bags. Therefore‚ the government should intervene to solve this problem: to introduce a charge
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Reduce Usage of plastic bag Plastic! Plastic! Plastic!.this materials is use by people all over the world.Plastic uses for many activity‚mainly for carry things.we can see plastic every day and every where in our life.at shop even at stall.Usage of plastic has advantage and disadvantage. The advantages of plastic are ‚ the misuse of plastic bags may be responsible for environmental contamination‚ they are much more eco-friendly than many assume‚ especially when looked at from their creation to
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Against :” Banning Plastic Bags”‚ taxes and bans don’t work‚ based on several reasons below. The communities thought that banning and taxing plastic bags would decrease the environmental problems. However‚ they had an opposite effect. After a 2002 tax on grocery bags in Ireland‚ consumers have used 10 percent more plastic bags than they did in Ireland’s pre-tax days. In San Francisco‚ people switch using plastic bags to paper bags was caused by San Francisco’s ban on plastic bags. Therefore‚ it caused
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SUBMISSION QUESTION 7 EXTERNALITIES AND COASE THEOREM (a) Explain what is meant by “externalities”? (b) Consider an industry whose production process emit a gaseous pollutant into the atmosphere. Use the simple supply and demand model to demonstrate that‚ in the absence of any regulation‚ this industry’s production will result in allocative inefficiency in the use of society’s resources. Externalities is cost or benefit from production or consumption of commodity that flow to external parties
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