An externality occurs when a transaction between a consumer and producer affects a third party. An example of this would be smoking. When a person buys a pack of cigarettes, they smoke them. In doing so, the smoke released from the person or the cigarette goes into the air. The people surrounding the person inhale the smoke and are affected. They are the third party that is affected by the transaction and don’t get any benefit just have to bear the consequences.
In this example, cigarette smoke releases toxins into the air and those toxins are inhaled by others around them. As many of you know, second hand smoke is a major concern for non-smokers. That is why they have made many places non-smoking environments, such as work areas and other public areas. Even here at St. Petersburg College, they have designated smoking areas.
The government has instilled laws that smoking should be prohibited in areas so the externality can be semi-resolved. I think this is one instance where the government made the right choice in making smoking illegal in many common areas so that people who smoke are not affecting people who don’t.
Subscribe to:
Post Comments (Atom)
I quit smoking cigarettes on February 21, 2009. While I was smoking, I was always respectful of non-smokers. The major problem with smokers is that they think they should be able to smoke whereever they want. It is their life to do with it what they wish. The problem with that disrespectful attitude is the effect smoke has on the people around them. If more smokers would have some respect for the non-smokers, there wouldn't need to be so many laws. Even on our college campus, people smoke all over campus, not just in designated smoking areas. I see people walking down the halls smoking, or smoking right outside of the library. Those are non-smoking areas. It is an issue of having respect for the people around you.
ReplyDeleteThe smoking example is great being that it has such a wide range of external costs. Not only are non smokers often subjected to the smoke, which is extremely irritating to those of us with allergies, but we are forced to care for smokers through our health care system. When a long time smoker develops lung cancer or another smoke related condition it becomes costly for future care, which hopefully is covered by insurance but often times not.
ReplyDeleteI agree i smoke every once in awhile mostly a social smoker but what i cant stand is when your at a restaurant and the person or persons that smoke have to leave the table to go outside and smoke because now you cant smoke inside anymore. I think sometime you don't even need to smoke its just a habit like for instance right before or after you eat to them its time to smoke when most of the time its not the right moment to go do that.
ReplyDelete