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Efficiency and Externalities in an Open-Ended Universe
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There is still much disagreement and debate concerning thls general
proposition. One of the most important areas of contention concerns the issue
of market externalities. Briefly put, not all of the costs and benefits of individual
trades are necessarily internalized by the traders. Some benefits and costs may
leak off and affect the behavior of other individuals who are not a direct party to
the exchange. Political economy has long been concerned about these so-called
"neighborhood effects" or "spillovers." For example, how should the liability for
harmful spillovers be determined? How are private production and consumption
decisions altered by positive and negative neighborhood effects? And if specific
externalities are determined to be socially inefficient, what is the most appropriate
public policy to restore market efficiency?
With regard to these issues, Roy Cordato's new book is both timely and
important. Questions of liability and efficiency with respect to negative spillovers
are current, cutting-edge public policy issues. In the area of industrial pollution
especially, significant private and taxpayer resources have been committed to
schemes to redress the "social costs" of alleged environmental degradation. In
addition, government agencies and the courts are increasingly regulating private
behavior in this area
Roy Cordato - Personal Name
1st Edition
NONE
Efficiency and Externalities in an Open-Ended Universe
Economics
English
The Ludwig von Mises Institute
2007
USA
1-162
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