Temple University
Economics 1102
Not all costs and benefits are obvious: |
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Externalities |
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Production - consumption; negative - positive | |||
Public goods |
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Non-rival | |||
Low | High | ||||
N o n e x c l u d a b l e |
High | Commons Good (Fish in the Ocean) | Public Good (Defense) | ||
Low | Private Good (Wheat) | Collective Good: (Pay-per-view TV) | |||
Information asymmetries |
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Moral hazard, adverse selection |
Positive | Negative | |
Production |
The beekeeper and the orchard |
![]() The coal fired power plant and you |
Consumption |
![]() Your neighbor's beautiful garden |
![]() Your neighbor's loud music |