Externality

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Externality

The cost or benefits of a transaction to parties who do not directly participate in it. Externality can be either positive or negative. For example, a merger can lead to higher share prices and bonuses for employees, benefiting shareholders and employees at the two companies merging, This can create wealth and positively impact a community. On the other hand, the merger can drive a competitor out of business, which results in layoffs and reduced wealth, which can hurt a community. Externality is also called spillover or the neighborhood effect. See also: External benefit, External cost.
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References in periodicals archive ?
positive externalities. But the symbolic and moral valence of carrots
An export subsidy is often advised in economies where positive externalities are associated with export activities.
The failure of prevailing tort law to cause the doctor to internalize the net risk created by his negligent choice emanates from its disregard for the positive externalities that the wrongdoing may generate.
Proponents of stadium subsidies often allude to the positive externalities the stadium will generate for the host city.
(28) The existence of these uncompensated positive externalities suggests, but does not by itself prove, that mark owners will produce too little information about their products.
With respect to goods that create positive externalities, too few are allegedly produced because the recipients of the externalities do not pay for the benefits bestowed upon them.
"Positive Externalities and Government Involvement in Education." The Journal of Private Enterprise 20:2, Spring.
impossible to fully internalize positive externalities in the
Because major disaster management planning necessarily involves various levels of government, the political benefits of such planning are automatically shared with other levels of government, that is, investing in planning confers positive externalities on other levels of government.
In addition, public education done correctly generates positive externalities that benefit the rest of us.
A delightful public-choice analysis follows, complete with bureaucratic incentives and interest-group politics, as well as a brief note on (and rejection of) the thesis that because compulsion has positive externalities, Paretian welfare economics lends support to it.
positive externalities. If this is true, an ideal regulatory system

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