EXTERNALITY

James Buchanan and Wm. Craig Stubblebine
Additional contact information
Wm. Craig Stubblebine: Claremont McKenna College, USA

Chapter 4 in Inframarginal Contributions to Development Economics, 2006, pp 55-73 from World Scientific Publishing Co. Pte. Ltd.

Abstract: AbstractExternality has been, and is, central to the neo-classical critique of market organisation. In its various forms — external economies and diseconomies, divergencies between marginal social and marginal private cost or product, spillover and neighbourhood effects, collective or public goods — externality dominates theoretical welfare economics, and, in one sense, the theory of economic policy generally. Despite this importance and emphasis, rigorous definitions of the concept itself are not readily available in the literature. As Scitovosky has noted, "definitions of external economies are few and unsatisfactory".1 The following seems typical:External effects exist in consumption whenever the shape or position of a man's indifference curve depends on the consumption of other men.[External effects] are present whenever a firm's production function depends in some way on the amounts of the inputs or outputs of another firm2.It seems clear that operational and usable definitions are required…

Keywords: Inframarginal; Transaction Costs; Division of Labor (search for similar items in EconPapers)
Date: 2006
References: Add references at CitEc
Citations:

Downloads: (external link)
https://www.worldscientific.com/doi/pdf/10.1142/9789812774255_0004 (application/pdf)
https://www.worldscientific.com/doi/abs/10.1142/9789812774255_0004 (text/html)
Ebook Access is available upon purchase.

Related works:
Chapter: Externality (1962)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:wsi:wschap:9789812774255_0004

Ordering information: This item can be ordered from

Access Statistics for this chapter

More chapters in World Scientific Book Chapters from World Scientific Publishing Co. Pte. Ltd.
Bibliographic data for series maintained by Tai Tone Lim ().