eksternalitas positif dan eksternalitas negatif

eksternalitas positif dan eksternalitas negatif

1. Chapter 3
Externalities and Public Policy

2. Externalities
Externalitiesare costs or benefits of
market transactions not reflected in
prices.
Negative externalitiesare costs to third
parties.
Positive externalitiesare benefits to third
parties.

3. Externalities and Efficiency
The marginal external costis
the dollar value of the cost to
third parties from the
production or consumption of
an additional unit of a good.
This occurs when there is a
negative externality.

4. Social Costs
MSC= MPC+ MEC

5. Figure 3.1 Market Equilibrium, A Negative
Externality and Efficiency
D = MSB
S = MPC
MPC + MEC =MSC
10
Price, Benefit, and Cost (Dollars)
Tons of Paper Per Year (Millions)
110
105
100
4.55
A
B
G
10

6. Implications of Figure 3.1
Market equilibrium occurs
where
MSC= MSB
Efficiency Requires that
MSC= MPC+ MEC= MSB

7. Positive externalities
The marginal external benefitis the
dollar value of the benefit to third
parties from an additional unit of
production of consumption of a
good. This occurs when there is a
positive externality.

8. Social Benefit
MSB= MPB+ MEB

9. Figure 3.2 Market Equilibrium, A Positive Externality
and Efficiency
S = MSC
MPB + MEB =MSB
H
Z
U
V
Price, Benefit, and Cost (Dollars)
Inoculations Per
Year (Millions)
10
25
30
45
1012
0

10. Figure 3.3 A Positive Externality for Which MEB
Declines With Annual Output
S' = MSC'
C
B
F
A
S = MSC
MPB
i
MPB
i+ MEB = MSB
Price, Benefit, and Cost (Dollars)
Inoculations per Year (Millions)
0
30
25
20
10 12 16 20

11. Internalization of Externalities
An externality can be
internalized if there is a
policy that causes market
participants to account for
the costs of benefits of their
actions.

12. Corrective Taxes to Negative
Externalities
Setting a tax equal to the
MECwill internalize a
negative externality.

13. Figure 3.4 A Corrective Tax
Price, Benefit, and Cost (Dollars)
Tons of Paper Per Year (Millions)
100
5
110
105
95
4.5
D =MSB
S =MPC
A
S’ =MPC +T =MSC
Tax Revenue = Total
External Costs
T
Net Gains in
Well-Being
G
B

14. Results of a Corrective Tax
Socially optimal levels of
production are achieved.
The tax revenue is sufficient
to pay costs to third parties.

15. Using a Corrective Tax
The greenhouse effect and a “Carbon
Tax”
If it is accepted that the greenhouse effect
is caused by burning carbon-based fuels, a
carbon tax can be imposed to limit
greenhouse gasses to their socially optimal
levels.
It is called a carbon tax because the
amount of the tax would depend on the
amount of carbon in the fuel.

16. Theory of the Second Best
When one condition for an
optimum is violated then
maintaining the others will
not guarantee a second-
best solution.

17. A Polluting Monopolist
In Chapter 2 it was shown that
monopoly created a loss to society. In
this chapter it was shown that a
negative externality causes a loss as
well.
The losses do not necessarily add to
one another. In fact, they can cancel
each other out.

18. Figure 3.5 A Second Best Efficient Solution
D = MSB
MPC
MPC + MEC = MSC
MR
Price
Output per Year
0 Q
M Q*
P M
A
F
B
C

19. Corrective Subsidies
Setting a subsidy equal to
MEBwill internalize a
positive externality

20. Subsidy Payments
Figure 3.6 A Corrective Subsidy
i
i
Y
D = MPB
D' = MPB + $20= MSB
S = MSC
Price, Benefit, and Cost (Dollars)
Inoculations per Year (Millions)
0
45
30
25
10
10 12
Z
V
R
X
U

21. Coase's Theorem
By establishing rights to use
resources government can
internalize externalities when
transactions or bargaining
costs are zero.

22. Figure 3.7 Coase’s Theorem
B A
MC
W
MC*
W
MPC
B+ MEC = MSC
MPC
B
Price of Beef (Dollars)
Price of Wheat (Dollars)
Wheat Output per Year
P
W
Q* W Q
W1
Beef Output per Year
Q*
B
Q
B1
P
B

23. Limitations of Coase’s Theorem
Transactions costs are not
zero in many situations.
However you allocate the
property right, the distribution
of income is affected.

24. Applying Coase's Theorem
The Clean Air Act of 1990 allows for the
sale of the "right to pollute." Firms face
a tradeoff when they pollute. If they
pollute they forgo the right to sell the
emission permit to others.
With electricity this has motivated firms
to shift to natural gas and away from
coal as a means of producing electricity.

25. Figure 3.8 Pollution Rights and Emissions
S= Supply of Pollution Rights
D =MSB of
Emitting Wastes
Price and Marginal Social Benefit
Tons of Annual Emissions
and Number of Pollution Rights
0
$20
75,000100,000

26. Figure 3.9 The Efficient Amount of Pollution
Abatement
E
MSB
MSC
Marginal Social Cost and Benefit
Percent Reduction in Wastes Emitted per Year
0 A* 100

27. Regulatory Solutions
Instead of using market
forces to cause firms to
internalize externalities we
can use emission standards
and apply these to all.

28. Figure 3.10 Regulating Emissions: Losses in Efficiency
From Differences in the Marginal Social Benefit of
Emissions
A
MEC =MSC
MSB
MEC =MSC
MSB
B
C
F
DQ
RB
DQ
RA
G
H
0
Q
R
10
Firm A
10
Cost and Benefit (Dollars)
Firm B
Q*
A
Q*
B
Q
B1
Q
B1
Tons of Emissions per Year

29. Figure 3.11 Losses in Efficiency From Emissions
Standards When MEC Differs Among Regions
MEC = MSC
MSB
MEC = MSC
S
Y
Z
T
R
X
DQ
RD
DQ
RC
Firm C
Tons of Emissions per Year
Firm D
20
Q*
C
Q
R
Q*
D
Q
RCost and Benefit (Dollars)

30. Sulfur Dioxide Emission Prices
SOURCE: United States Environmental Protection Agency
250
200
150
100
50
0
8/1/94
Allowance Price (Dollars)
Month/Year
8/1/95 8/1/95 8/1/958/1/95 8/1/95
Fieldston Publications Price Index Cantor Fitzgerald Market Price Index

31. Global Externalities
CFC’s
Deforestation
Global Warming