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Managing Externalities

Across
Government limits ___________ externalities through taxes and fines - offset medical costs, provide incentives to reduce pollution
Government tries to increase ___________ externalities
Market failure occurs when economic _____________ cause externalities
Spreading Positive Externalities - A new college benefits local businesses, ___________ as whole
Externality--______________ on someone other than producer or buyer
Down
Subsidy--government _____________ to help cover cost of economic activity - subsidy to drug company to make flu vaccine yields fewer sick people
positive externality _____________ people uninvolved in transaction
Paying for Negative Externalities -Factory owners have little __________ to pay to cut industrial pollution
negative externality--people ____________ in the transaction pay costs