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Definition
| The cost borne by the producer of a good or service. |
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Definition
| The total cost of producing a good or service, including both the private cost and any external cost. |
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| The benefit received by the consumer of a good or service. |
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| The total benefit from consuming a good or service, including both the private benefit and any external benefit. |
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Definition
| A situation in which the market fails to produce the efficient level of output. |
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| The rights individuals or businesses have to the exclusive use of their property, including the right to buy or sell it. |
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Definition
| The costs in time and other resources that parties incur in the process of agreeing to and carrying out an exchange of goods or services. |
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Term
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Definition
| The argument of economist Ronald Coase that if transactions costs are low, private bargaining will result in an efficient solution to the problem of externalities. |
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Term
| Pigovian taxes and subsidies |
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Definition
| Government taxes and subsidies intended to bring about an efficient level of output in the presence of externalities. |
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Definition
| An approach that involves the government imposing quantitative limits on the amount of pollution firms are allowed to emit or requiring firms to install specific pollution control devices. |
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Definition
| The situation that occurs when one person's consuming a unit of a good means no one else can consume it. |
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Definition
| The situation in which anyone who does not pay for a good cannot consume it. |
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Definition
| A good that is both rival and excludable. |
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Term
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Definition
| A good that is both nonrivalrous and nonexcludable. |
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Definition
| Benefiting from a good without paying for it. |
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Definition
| A good that is rival but not excludable. |
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Term
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Definition
| The tendency for a common resource to be overused. |
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