Externalities are spill-over effects from production and consumption for which no appropriate compensation is paid
Externalities lie outside the initial market transaction / price
Externalities cause market failure if the price mechanism does not take account of the social costs and benefits of production and consumption
Which goods and services are best left to the market? And which are more efficiently and fairly provided as collective consumption goods by the state? This is at the heart of your revision of public goods. Central to your revision will be to understand why public goods may not be provided by the market. You can work this out by distinguishing between public and private goods and focusing on the ideas of rivalry and excludability in consumption. Students should understand the free rider and valuation problems – there are big debates in economics about the optimum size of the state. Rapid changes in technology are also changing the nature of what is and what is not a public good.
Externalities are spill-over effects from production and consumption for which no appropriate compensation is paid
Externalities lie outside the initial market transaction / price
Externalities cause market failure if the price mechanism does not take account of the social costs and benefits of production and consumption
Which goods and services are best left to the market? And which are more efficiently and fairly provided as collective consumption goods by the state? This is at the heart of your revision of public goods. Central to your revision will be to understand why public goods may not be provided by the market. You can work this out by distinguishing between public and private goods and focusing on the ideas of rivalry and excludability in consumption. Students should understand the free rider and valuation problems – there are big debates in economics about the optimum size of the state. Rapid changes in technology are also changing the nature of what is and what is not a public good.
Since pollution is an externality firms will not undertake to control their pollution. The answer is in government regulations. Coase argues that in perfect competition with laissez faire, govt regulation is not needed. Instead bargaining between the polluters and their victims can lead to an optimal situation. But this pre supposes equality in bargaining, and does not take note of ecological consequences of pollution.
This presentation is based on the business cycle as a whole and its effects in the employment, production, inflation as well as government interference.
This short revision presentation looks at examples of regulations in markets as part of interventions to address market failure. It also looks at some of the benefits and costs of tougher regulatory interventions.
Since pollution is an externality firms will not undertake to control their pollution. The answer is in government regulations. Coase argues that in perfect competition with laissez faire, govt regulation is not needed. Instead bargaining between the polluters and their victims can lead to an optimal situation. But this pre supposes equality in bargaining, and does not take note of ecological consequences of pollution.
This presentation is based on the business cycle as a whole and its effects in the employment, production, inflation as well as government interference.
This short revision presentation looks at examples of regulations in markets as part of interventions to address market failure. It also looks at some of the benefits and costs of tougher regulatory interventions.
In this session we will look at some of the policy options for tackling climate change with the long term aim of de-carbonisation
In 2015, the earth’s surface temperature was around 0.9 Celsius degrees warmer than the 20th century average
Many economists recommend applying the polluter pays principle and placing a price on carbon dioxide and other greenhouse gases. This can be implemented either through a carbon tax (known as a price instrument) or a cap-and-trade scheme (a so-called quantity instrument).
Introduction to the EU Emission Trading SystemLeonardo ENERGY
The EU ETS Directive is the centrepiece of the European Union’s climate policy. It has created the European Union’s Emissions Trading Scheme (EU ETS), which is a unique and quite com-plex system.
The EU ETS establishes a scheme for greenhouse gas emissions allowances trading within 31 European countries. Its functioning is based on a “cap and trade” principle, which sets a cap on the total amount of greenhouse gases that can be emitted by all participating installations. Within the cap, companies receive or buy emission allowances which they can trade with one another as needed.
Today, the EU ETS covers almost half of EU’s emissions and is part of the daily life of a large number of companies.
The EU ETS Directive represents the backbone of EU’s action against climate change, but it also works in combination with several other pieces of legislation in a delicate balance.
Our European system has very much evolved during the last 15 years. The existing legislation operates until 2020. It has set a greenhouse gas emissions reduction target in line with EU’s 2050 low carbon economy roadmap. The time has also come to discuss the post-2020 period and the European Commission will soon put forward a new proposal with a 2030 emissions reduction target.
Being the first one to have been setup, the European scheme is analysed and taken as exam-ple in other regions of the world where emissions trading starts being implemented.
This course aims at giving a presentation of the EU ETS Directive, the main features of the sys-tem, the balance with other pieces of EU legislation and at offering perspectives for the on-coming review of the scheme.
This presentation by Nicole ROSENBOOM, Principal, Oxera Consulting LLP, was made during the discussion “Out-of-Market Efficiencies in Competition Enforcement” held at the 141st meeting of the OECD Competition Committee on 6 December 2023. More papers and presentations on the topic can be found out at oe.cd/omee.
This presentation was uploaded with the author’s consent.
What is carbon pricing? What is carbon tax? Is carbon tax suitable for Indonesia condition? Can we implement carbon tax in Indonesia? What are the challenges of carbon tax implementation in Indonesia?
Operation “Blue Star” is the only event in the history of Independent India where the state went into war with its own people. Even after about 40 years it is not clear if it was culmination of states anger over people of the region, a political game of power or start of dictatorial chapter in the democratic setup.
The people of Punjab felt alienated from main stream due to denial of their just demands during a long democratic struggle since independence. As it happen all over the word, it led to militant struggle with great loss of lives of military, police and civilian personnel. Killing of Indira Gandhi and massacre of innocent Sikhs in Delhi and other India cities was also associated with this movement.
Ethnobotany and Ethnopharmacology:
Ethnobotany in herbal drug evaluation,
Impact of Ethnobotany in traditional medicine,
New development in herbals,
Bio-prospecting tools for drug discovery,
Role of Ethnopharmacology in drug evaluation,
Reverse Pharmacology.
Palestine last event orientationfvgnh .pptxRaedMohamed3
An EFL lesson about the current events in Palestine. It is intended to be for intermediate students who wish to increase their listening skills through a short lesson in power point.
The French Revolution, which began in 1789, was a period of radical social and political upheaval in France. It marked the decline of absolute monarchies, the rise of secular and democratic republics, and the eventual rise of Napoleon Bonaparte. This revolutionary period is crucial in understanding the transition from feudalism to modernity in Europe.
For more information, visit-www.vavaclasses.com
We all have good and bad thoughts from time to time and situation to situation. We are bombarded daily with spiraling thoughts(both negative and positive) creating all-consuming feel , making us difficult to manage with associated suffering. Good thoughts are like our Mob Signal (Positive thought) amidst noise(negative thought) in the atmosphere. Negative thoughts like noise outweigh positive thoughts. These thoughts often create unwanted confusion, trouble, stress and frustration in our mind as well as chaos in our physical world. Negative thoughts are also known as “distorted thinking”.
Synthetic Fiber Construction in lab .pptxPavel ( NSTU)
Synthetic fiber production is a fascinating and complex field that blends chemistry, engineering, and environmental science. By understanding these aspects, students can gain a comprehensive view of synthetic fiber production, its impact on society and the environment, and the potential for future innovations. Synthetic fibers play a crucial role in modern society, impacting various aspects of daily life, industry, and the environment. ynthetic fibers are integral to modern life, offering a range of benefits from cost-effectiveness and versatility to innovative applications and performance characteristics. While they pose environmental challenges, ongoing research and development aim to create more sustainable and eco-friendly alternatives. Understanding the importance of synthetic fibers helps in appreciating their role in the economy, industry, and daily life, while also emphasizing the need for sustainable practices and innovation.
This is a presentation by Dada Robert in a Your Skill Boost masterclass organised by the Excellence Foundation for South Sudan (EFSS) on Saturday, the 25th and Sunday, the 26th of May 2024.
He discussed the concept of quality improvement, emphasizing its applicability to various aspects of life, including personal, project, and program improvements. He defined quality as doing the right thing at the right time in the right way to achieve the best possible results and discussed the concept of the "gap" between what we know and what we do, and how this gap represents the areas we need to improve. He explained the scientific approach to quality improvement, which involves systematic performance analysis, testing and learning, and implementing change ideas. He also highlighted the importance of client focus and a team approach to quality improvement.
2024.06.01 Introducing a competency framework for languag learning materials ...Sandy Millin
http://sandymillin.wordpress.com/iateflwebinar2024
Published classroom materials form the basis of syllabuses, drive teacher professional development, and have a potentially huge influence on learners, teachers and education systems. All teachers also create their own materials, whether a few sentences on a blackboard, a highly-structured fully-realised online course, or anything in between. Despite this, the knowledge and skills needed to create effective language learning materials are rarely part of teacher training, and are mostly learnt by trial and error.
Knowledge and skills frameworks, generally called competency frameworks, for ELT teachers, trainers and managers have existed for a few years now. However, until I created one for my MA dissertation, there wasn’t one drawing together what we need to know and do to be able to effectively produce language learning materials.
This webinar will introduce you to my framework, highlighting the key competencies I identified from my research. It will also show how anybody involved in language teaching (any language, not just English!), teacher training, managing schools or developing language learning materials can benefit from using the framework.
2. Negative Production & Consumption Externalities
Negative externalities occur when production and/or consumption
impose external costs on third parties outside of the market for
which no appropriate compensation is paid.
Negative production externalities Negative consumption externalities
• Air pollution from factories • Fly-tipping of household waste
• Damage to the environment
from industrial ocean fishing
• Effects of passing smoking
• External costs of fertilizers and
pesticides used in farming
• Impact on family life of gambling
and alcohol addiction
• Noise pollution from the airline
industry
• Noise pollution from events such
as sports matches and concerts
3. Examples of Negative Production Externalities
Negative production externalities include pollution generated by a
factory that imposes costs on others
Air pollution
from factories
Pollution from
fertilizers
Industrial waste
Noise pollution Collapsing fish
stocks
Methane
emissions
When
answering
any question
on negative
externalities –
consider
whether the
external costs
are significant
and if so,
whether they
can be
measured
and valued
accurately
4. World Carbon Dioxide Emissions from 2005 to 2014
0
5000
10000
15000
20000
25000
30000
35000
40000
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
Emissionsinmillionmetrictons
Africa South and Central America Middle East
Europe and Eurasia North America Asia Pacific
5. Negative Externalities in Production – Market Failure
Output
Marginal
Private
Cost
P1
Q1
Marginal
Private
Benefit
Negative externalities causes social cost > private cost
Costs,
Benefits
£s
Marginal
Social
Cost
Q2
P2
The equilibrium
level of output
delivered by a
free market is at
Q1 where MPB =
MPC and it is
allocatively
inefficient.
We assume in
this example that
there are no
externalities
arising from
consumption
Note
If MSC pivots
away from
MPC then the
marginal
external cost
of extra output
is assumed to
be increasing
6. Negative Externalities – The Social Welfare Loss
Output
Marginal
Private
Cost
P1
Q1
Marginal
Private
Benefit
Market failure happens when prices do not reflect social costs
Costs,
Benefits
£s
Marginal
Social
Cost
Q2
P2 This is the area
of social welfare
loss because the
market output
supplied is
higher than the
social optimum
Note
The
deadweight
loss of social
welfare
happens when
MSC > MPC
7. Examples of Negative Consumption Externalities
Negative consumption externalities are spillover costs generated
and received in the consumption of goods and services.
Vehicle
pollution
Household
waste
Noise pollution
from neighbours
Air pollution
from smokers
Traffic
congestion
Gambling
addiction
Litter from
tourists
Spillover costs
from obesity
8. Reducing Externalities – The Use of Pollution Taxes
• One approach is to impose a tax.
This is known as “making the
polluter pay”.
• A pollution tax increases the
marginal private cost causing a
fall in demand
• Some economists argue that
revenue from pollution taxes
should be ‘ring-fenced’ and
allocated to projects that protect
or enhance the environment.
• For example, money raised from
a congestion charge might be
allocated towards improving
mass transport services
• Revenue from higher taxes on
cigarettes might be used to fund
better health care programmes.
British Columbia uses a
Carbon Tax
China has raised smoking
taxes
Emissions Trading
Scheme in the EU
Proposed congestion
charge for New Delhi
9. Reducing Externalities: Carbon Trading in the EU
• The EU Carbon Emissions
Trading Scheme is cap-
and-trade scheme for
carbon dioxide
• It sets a decreasing cap for
CO2 from energy intensive
sectors, and allocates or
auctions emissions
allowances which can be
traded on the open
market.
• Businesses need to buy
enough emissions
allowances – the higher
the price, the greater the
incentive to cut pollution
• Aviation has just been
included in the scheme
The consensus is that a carbon allowance price of at
least €30 a tonne is needed to drive investment in low
or zero emission technology. But the EU carbon price
has rarely reached this level. Indeed in recent years, an
excess supply of permits has led to the market price of
carbon permits collapsing to below €10 per tonne
10. Reducing Externalities: The UK Carbon Price Floor
• The UK has introduced a Carbon
Price Floor which applies to fossil
fuels used for electricity
generation
• The minimum price for carbon
emissions is designed to provide
a stable carbon price signal as a
way of internalising externalities
• The minimum Carbon Price Floor
started at £16/tCO2 in 2013
• In 2014 the UK government
announced a cap of £18/tCO2
from 2016 until 2020
• Carbon prices within the EU ETS
system have been highly volatile
in recent years
Arguments for a carbon price floor
• Reduces the risks, and thus costs, of
investing in low carbon projects
• Helps to reduce carbon price
volatility – sends signal to polluters
• Makes low carbon electricity more
competitive – boost to renewables
Arguments against a carbon price floor
• Restrict supply of carbon permits to
increase the free market price
• A carbon tax is a better alternative
and raises useful tax revenues
• Price floor set high might damage
international competitiveness
11. Advantages / Disadvantage of Pollution Taxes
Pros Internalizes the
externality and therefore
makes the polluter pay
Utilizes the price
mechanism to change
incentives and choices
e.g. to reduction pollution
Raises tax revenue which
might then be used to
address other market
failures
Cons Low price elasticity of
demand – tax may not
change behaviour
Risk of tax evasion and
tax avoidance
May hit lower income
families most and cause
some social unrest
12. Topical Examples of Externalities in Transport
Congestion
externalities from
vehicles
Noise and air pollution
from aircraft
Damage to sea bed
from freight containers
The expansion of
electric car ownership
and use
Growth of car sharing
apps reduce single-car
usage
Investment in light rail
infrastructure
13. Evaluation: Problems with Environmental Taxes
Pollution taxes can lead to government failure:
1. Assigning the right level of taxation: There are problems in
setting the right tax so that private cost will exactly equate with
the social cost
2. Consumer welfare effects: Producers may pass on a tax to the
consumers if the demand for the good is inelastic and, as
result, the tax may only have a small effect in reducing demand.
Taxes on some de-merit goods (for example cigarettes) may
have a regressive effect on lower-income consumers and lead
to a widening of inequalities in the distribution of income.
3. Employment and investment consequences: If pollution taxes
are raised in one country, producers may shift to countries with
lower taxes. This will not reduce global pollution, and create
problems such as structural unemployment and a loss of
international competitiveness / worsening of the trade balance.
14. Cutting Emissions From Cars – EU Policies in Action
Regulations on Max CO2
Emissions per km Travelled
A command and
control approach
2015: Max 130gms per
km +penalties for
exceeding
Effective in driving
innovation
Cap on emissions
higher than actual
Max limit might shift
FDI outside the EU
Bringing vehicles into the
Emissions Trading Scheme
Cap on emissions –
“allowances” are
traded
Incentives for
investment in low
carbon technologies
Most efficient
emissions reducers can
sell some allowances
Collapse in prices has
eroded the incentives
for investment
Higher road and fuel taxes
Inelastic demand – fuel
taxes generate
significant revenues
Easy to collect and
adjust the rate
Tax depends on actual
fuel consumption not
theoretical level
But cannot guarantee
target specific
reductions in emissions
15. Progress in Cutting Emissions From Cars in the UK
171.4
169.4
167.2
164.9
158
149.5
144.2
138.1
133.1
128.3
124.7
120
130
140
150
160
170
180
2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
CO²ing/km
Year
Average carbon dioxide emissions from new cars in the UK between 2004 and 2014 (in
grams per kilometre)
16. Externalities and Government Regulations - Examples
• Health and Safety at Work Act covering all businesses.
• Renewables Obligation Certificates to encourage the supply of
renewable energy (+ penalties for not meeting targets)
• Councils using by-laws preventing public consumption of alcohol.
• Consumer protection legislation e.g. against dangerous goods
• Laws such as the ban on smoking in public places from July 2007
• The European Union has introduced directives on how durables
such as cars, batteries, fridges freezers should be disposed of
• The EU also imposes increasingly tough rules on carbon emissions
from vehicles which all EU manufacturers must meet
• Speed limits on roads and weight limits for lorries
• Quotas on how much fishing can take place in EU waters
• Bans on sale of certain substances / minimum age of legal sale
• Lowering alcohol limit for drivers – reduced by Scotland in 2014
17. Evaluating the Impact of Industry Regulations
The case for regulating negative
externalities
Costs / disadvantages of adding
extra regulation of industries
• Regulations act as a spur for
business innovation e.g. to cut
the level of carbon emissions
• High cost of enforcement /
administration of laws /
regulations
• Regulations may be more
effective if demand is
unresponsive to price changes
• Regulations can lead to
unwelcome unintended
consequences / Govt failure
• Regulations can be gradually
toughened each year – this will
help stimulate capital
investment
• The cost of meeting
regulations can discourage
small businesses and lower
competition in markets
