Externalities Flashcards
1
Q
what is spillover effect
A
the effect that one situation or problem will have on another
2
Q
what are external costs
A
negative spillover effects of production or consumption that will effect a third party
3
Q
what are some external costs (6)
A
noise pollution
resource depletion
air pollution
water pollution
overcrowding
traffic congestion
4
Q
what is the pnemonic to remember external costs
A
ROT WARN
5
Q
what are external benefits
A
positive spillover effects of production/consumption which benefit third parties
6
Q
what are some external benefits of education
A
- increased skillsets
- increased productivitu
- household mobility
- better jobs
- increased standard of living if more doctors etc
- lower unemployment
7
Q
what are some external benefits of healthcare
A
- personal health improvment
- less sick days off work
- more efficient work
8
Q
what are some external benefits of vaccinations
A
- probability of disease contraction lowers
- lowers for non vaccinated aswell
- less sick days off work
9
Q
A
