It is generally the unintended, indirect consequence of everyday economic activities. Externalities occur when the transactions between two parties affect the existence and well-being of a third.

Sometimes these indirect effects are tiny. But when they are large they can become problematic—what economists call externalities. Externalities are among the main reasons governments intervene in the ...

These "externalities" don't show up on the typical supply-and-demand diagram; but if they did, they'd shift the curves. The classic supply-and-demand diagram has two axes. The horizontal axis ...

9) includes two examples that highlight the best way to handle externalities, the economic term for costs imposed on others. According to these examples, dumping toxic waste and using dirty fuels ...

It is rather a way of assessing the regulatory or reputational risks that arise from “negative externalities”. A company may also be expected to gauge how seriously at risk it is from climate ...

In this piece, I show that the standard theory of externalities in economics falls in the same camp. For long, like any other student of economics, I thought of externalities as an inefficiency ...

These behaviors include the reduction of negative externalities, a potential shift from shareholder to stakeholder primacy, supply chain improvements, and investments in natural capital. A business ...

More productive firms may choose to locate in industry clusters in order to benefit from agglomeration externalities. However, negative sorting and adverse selection effects are also possible. This ...

By a network I mean a social arrangement held together by what economists call network externalities — situations in which people find it convenient to engage in some activity because many other ...