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Externalities

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  • Verhoef Erik T.

    (Vrije Universiteit Amsterdam, Faculteit der Economische Wetenschappen en Econometrie (Free University Amsterdam, Faculty of Economics Sciences, Business Administration and Economitrics)

Abstract

This paper discusses the concept of ‘externalities ‘. It starts with a brief discussion of market failures in the neoclassical economic framework. It then proceeds to a definition of externalities, thereby distinguishing external effects from other sorts of ‘unpriced effects ‘. Finally, some attention is paid to the relation, and tension, between efficiency and equity impacts of externalities.

Suggested Citation

  • Verhoef Erik T., 1997. "Externalities," Serie Research Memoranda 0031, VU University Amsterdam, Faculty of Economics, Business Administration and Econometrics.
  • Handle: RePEc:vua:wpaper:1997-31
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    References listed on IDEAS

    as
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    JEL classification:

    • E13 - Macroeconomics and Monetary Economics - - General Aggregative Models - - - Neoclassical

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