Externalities, Pollution and Global Warming

Topic 4: Externalities, Pollution and Global Warming ECON 1210B Economics and Society 1 Introduction Recall: Markets are usually a good way to organize economic activity In the absence of market failures, the market outcome is efficient, maximizes total surplus One major type of market failure: externalities Externality: the uncompensated impact of one person’s actions on the well-being of a bystander 2 Externalities and EfficiencyIn the presence of externality, market equilibrium is no longer efficient Individual’s estimates of resources value (or cost) are not correct (from the society’s point of view) Traditional belief: Government to step in to ensure efficient resource allocation And to protect the interest of bystanders as well 3 Negative Externality Negative Externality: the effect on bystanders is adverse Example: the neighbor’s barking dog talking on cell phone while driving makes the roads less safe for others health risk to others from second-ha nd smoke noise pollution from construction projects 4 Pollution: A Negative ExternalityFirms burn huge quantities of fossil fuels (coal, natural gas, oil) that cause acid rain and global warming Firms dump toxic waste into rivers, lakes, and oceans These environmental issues are simultaneously everybody’s problem and nobody’s problem 5 Pollution: A Negative Externality Example of negative externality: Air pollution from factory Firm does not bear the full cost of its production, so will produce more than the socially efficient quantity How govt may improve the market outcome: Impose a corrective tax on the firm equal to the external cost of the pollution it generates 6 Recap of Welfare EconomicsP $5 4 3 $2. 50 2 1 0 The market for gasoline The market eqm maximizes consumer + producer surplus. Supply curve shows private cost, the costs directly incurred by sellers Demand curve shows private value, the value to buyers (the prices they are willing to pay) 0 10 20 25 30 Q (gallons) 7 Analysis of a Negative Externality Key: distinguish private and social costs Private costs and social costs diverge in the presence of externality Producer concerns private cost, which neglect the external cost (pollution cost) Social cost represents the resource cost to a society social cost = private cost + external cost 8Analysis of a Negative Externality P $5 4 3 2 1 0 The market for gasoline Social cost =private+ external cost external cost 0 External cost = value of the negative impact on bystanders = $1 per gallon (value of harm Supply (private cost) from smog, greenhouse gases) 10 20 30 Q (gallons) 9 Analysis of a Negative Externality P $5 4 3 2 D 1 0 The market for gasoline Social cost S The socially The socially optimal quantity optimal quantity is 20 gallons. is 20 gallons.At any Q < 20, At any Q < 20, value of additional gas value of additional gas exceeds social cost exceeds social cost At any Q > 20, At any Q > 20, social cost of the social cost of the last gallon is last gallon is greater than its value greater than its value 10 0 10 20 25 30 Q (gallons) Analysis of a Negative Externality P $5 4 3 2 D 1 0 The market for gasoline Mkt eqm (Q = 25) Social cost is greater than social optimum S (Q = 20) overproduction resulted in DWL (red triangle) One solution: impose a corrective tax of $1/gallon on sellers, shift supply curve up $1 11 0 10 20 25 30 Q (gallons) Internalizing the ExternalityInternalizing the externality: altering incentives so that people take account of the external effects of their actions previous example: $1/gallon tax on sellers makes sellers’ costs equal to social costs When market participants must pay social costs, the market eqm matches the social optimum. Imposing the tax on buyers would achieve the same outcome: market Q will equal optimal Q 12 Summary For Pollution: A Negative Externality With negative externality, QMarket >QSocial Optium firms over-produce (DWL exist) Remedy: The government can intern alize the externality by imposing corrective tax Price tax S’ SQ = Qmarket = initial eqm Q’ = QSocial Optium = eqm after tax D Q’ Q Quantity 13 Externality in Consumption Consumption of alcohol, tobacco, and gasoline (private driving) all create negative externality to the society Got impose a heavy corrective tax on these goods to alter the incentives of customers, in order to mitigate of negative externality 14 Corrective Tax Rate (Levy / Charges) in HK Alcohol: 100% tax rate for alcohol with strength of more than 30% by volume Cigarettes: $1. 7 / each cigarette, tax for a pack of 20-stick cigarettes = $34 70% of the selling price of $50 / pack Leaded petrol: $6. 823/ litre, unleaded petrol: $6. 6/ litre About 40% of the selling price of each litre of gasoline 15 Example: Gasoline Tax Targets 3 Negative Externalities Congestion: the more you drive, the more you contribute to congestion Accidents: larger vehicles cause more damage in an accident Pollution: burn ing fossil fuels produces greenhouse gases 16 Case Study: Environmental Levy on Plastic Shopping Bags in HK Survey indicates that some 8 billion (8,000,000,000) plastic shopping bags are disposed of at landfills every year in HK This translates into more than 3 plastic shopping bags per person per day, which apparently go beyond our needs 7 Case Study: Environmental Levy on Plastic Shopping Bags in HK Address the problem of abuse, gov introduced an levy of $0. 5 HKD on each plastic shopping bag at the retail level Estimated negative externality of each plastic bag = ? 18 Positive Externality Positive Externality: the effect on bystanders is beneficial Example: When you get a flu vaccination, everyone you come into contact with benefits Research and Development (R&D) creates knowledge others can use Renovating your house increases neighboring property values Restores of historical building 19 Positive Externalities from EducationA more educated population benefits society: lower crim e rates: educated people have more opportunities, so less likely to rob and steal better government: educated people make better-informed voters People do not consider these external benefits when deciding how much education to â€Å"purchase† 20 Positive Externalities from Education Result: market eqm Q of education too low How govt may improve the market outcome: subsidize cost of education In the presence of a positive externality, the social value of a good includes private value: the direct value to buyers external benefit: the value of the positive impact on bystanders 21Analysis of a positive externality P The market for flu shots $50 40 30 20 10 0 0 10 20 30 S D External benefit = $10/shot Draw the social value curve. Find the socially optimal Q. What policy would internalize this externality? Q 22 Analysis of a positive externality P The market for flu shots $50 40 30 20 10 0 0 10 20 25 30 external benefit S Mkt eqm Q = 20 Social optimal Q = 25 underproduction result ed in DWL (red triangle) Social value = private value + external benefit D To internalize the externality, use Q subsidy = $10/shot. 23Case Study: Innovation and Technology Policy in HK Should government subsidize high tech companies? Pros: Spillover effects International competitiveness Cons: Potential misallocation of public resource Potential problems of unfairness & corruption 24 Case Study: Innovation and Technology Policy in HK Eg: Cyberport IT project? 25 Summary: Corrective Tax and Subsidy to Deal With Externalities If negative externality market produces a larger quantity than is socially desirable If positive externality market produces a smaller quantity than is socially desirable 6 Summary: Corrective Tax and Subsidy to Deal With Externalities remedy the problem: â€Å"internalize the externality† tax goods with negative externalities ideal corrective tax = external cost subsidize goods with positive externalities ideal corrective subsidy = external benefit 27 Pri vate Solutions to Externalities? Government intervention is always controversial Major concerns of government intervention include fairness and efficiency The market does develop some possible solutions to externality over time 28 Private Solutions to Externalities?Social norms / moral codes Eg: littering Mergers Eg: MTR as a property developer Contracts between market participants and the affected bystanders However: If an externality affects many people, contract negotiation is virtually impossible 29 Public Policies Toward Negative Externalities Market-based policies provide incentives so that private decisionmakers will choose to solve the problem on their own Corrective Tax Tradable Pollution Permits 30 Public Policies Toward Negative Externalities Command-and-control policies: Regulation regulate behavior directly.Examples: limits on quantity of pollution emitted requirements that firms adopt a particular technology to reduce emissions 31 Policy Option: Example â€Å"Ace Elec tric† and â€Å"Billy Power† both are running coal-burning power plants Each emits 40 tons of sulfur dioxide per month SO2 causes acid rain & other health issues Policy goal: reducing SO2 emissions 25% to 60 tons/month 32 Policy Option: Regulation Vs Corrective Tax Policy options 1. regulation: require each plant to cut emissions by 25% 2. corrective tax: make each plant pay a tax on each ton of SO2 emissions. Set tax at level that achieves goal. 33Policy Option: Regulation Vs Corrective Tax Under Policy option 1, regulation, firms have no incentive to reduce emissions beyond the 25% target Suppose cost of reducing emissions is lower for â€Å"Ace Electric† than for â€Å"Billy Power† Socially efficient outcome: â€Å"Ace Electric† reduces emissions more than â€Å"Billy Power† 34 Policy Option: Regulation Vs Corrective Tax Corrective tax is a price on the right to pollute Under policy option 2, tax on emissions gives firms incentive to conti nue reducing emissions as long as cost of doing so is less than the tax If a cleaner technology available, tax gives firms incentive to adopt it Tax payment is money!So, corrective taxes enhance efficiency by aligning private with social incentives 35 Policy Option: Tradable Pollution Permits Recall: â€Å"Ace Electric† and â€Å"Billy Power† each emit 40 tons SO2, total of 80 tons. Goal: reduce 25% emissions to 60 tons/month Policy option 3: Tradable Pollution Permits issue 60 permits, each allows its holder to emit one ton of SO2 give 30 permits to each firm establish market for trading permits 36 Policy Option: Tradable Pollution PermitsEach firm can choose among these options: emit 30 tons of SO2, using all its permits emit < 30 tons, sell unused permits buy additional permits so it can emit > 30 tons 37 Policy Option: Tradable Pollution Permits A system of tradable pollution permits achieves goal at lower cost than regulation Firms with low cost of reducing pollut ion (Ace Electric) sell whatever permits they can Firms with high cost of reducing pollution (Billy Power) buy permits Result: incentive to reduce pollution: permit = money 38Tradable Pollution Permits in the Real World Emission of greenhouse gases causes the global warming The primary greenhouse gas in the atmosphere is the emission of carbon dioxide Carbon emissions trading is a form of emissions trading that specifically targets carbon dioxide 39 Tradable Pollution Permits in the Real World Carbon emissions permits traded in Europe since January 1, 2005 Recall: permit = money Firms will have strong incentive to reduce carbon emissions 40

Life Without Limits Essay

There are some things in life that are out of your control that you can’t change and you’ve got to live with. The choice that we have, though, is either to give up or keep on going. I tell your life is interesting, Life is a JOURNEY. But I tell you there are sometimes in life where you fall down and you feel you don’t have the strength to get back up. You see, if you try 100 times to get back up and if you fail 100 times, if you FAIL and you’ll going to GIVE UP, do you think that you’ll ever going to get up? No. But if you fail and try again? And again and again? For as long as you try there is always that chance of YOU getting up. Does that make sense? And it’s not the end until you’ve given up. And just the fact that you’re here should persuade you that you have another chance to get back up. There’s still HOPE. And I want you to know that we can find our strength in GOD and you’re going to find your strength in whatever you find it in. But I just all want you to know that it’s not the end. It matter how you are going finish. Are you gonna finish strong? Now, try to ask yourself a couple of questions. And the first question was â€Å"Who am I? Who am I?† I’m Rj Abutazil. But who is that? And it’s funny how the friends around you sort of determined who you are. You change yourself. Just like for example, you come to school or to your work and everybody swore around you and so you started swearing. Why? Because it’s the cool thing to do and now, everybody swears. So you didn’t want to be left out and I wanted to be accepted and so I started swearing. You go to a party and everybody’s drinking so you drink. Why? Well, everybody else around me is doing it, big deal! And you start losing yourself and you start putting your security in temporary things. You start putting your happiness in things won’t last. You can get drunk all you like but in the morning you’re going to be sober with a headache with the same problems. You want to be high for the rest of your life on drugs? Everybody saying, â€Å"Don’t do drugs! Donâ€⠄¢t do drugs!† Well, Why? Why do we even go there? Because of our curiosity, peer pressures, or trying to escape reality. Basically, 3 things. That’s why we go to drugs, sex, and alcohol. Why do you do it? Because it feels good. Okay. That’s how we do it. I mean, you want something? you go and get it. You want to but something? You save up money and you go get it. Why? Because that will make you happy. And we take these steps in the wrong direction that will actually take you away from your dreams. Oh, don’t worry my friend, drugs and alcohol won’t me take away from my dreams and my purpose and sex and all that. NO! But I tell you, it actually will. Because you go to level of drinking and you go a level of drugs and it’s not enough. You’ll find that out. Then you’ll try something new. And you’ll also go to school or to your work and people will put you down and you classmates and friends will tell you that you are failure because you failed in a test or got fired up from work. And you start believing the lies around you saying that you’re not good enough and no one’s going to want you and you’ll nev er do anything good in your life and you’ll never, ever achieve the dreams and goals that you wish you had done. Or wish that you could do. And these steps take you closer to the voice saying â€Å"YOU’RE NOT GOOD ENOUGH.† And all you need is just one more step for the fall. See, you have the choice to know which step you’re going to take today. Let me ask you, do you know who you are? Do you want to know who I think you are? I tell you right now. You care about what your friends think who you are. You care about their opinion. I don’t care how you look, honestly! I don’t care! But I’m going to come and tell you that you are awesome just the way you are. So when you say â€Å"Well, I have this.† or â€Å"I Don’t have that, I’m not good enough.† I’m going to go, â€Å"So, what? I don’t care!.† You are worth more than diamonds. All the diamonds in the world, you are so precious. Every single one of your hearts, you can do something, not just something you can do, but you can live, LIFE! Life is not always good. Life is not always ros y. Life is worth living when you find purpose. Everything you do, just follow your heart. If that’s who you want to be, if that’s what you want to do in life, then walk to it. One day at a time. But I want you to know that nothing is IMPOSSIBLE and if it is impossible for your dreams to come true let’s say you want to become a Doctor or a Lawyer and you can’t become a Doctor or a Lawyer for some reason, maybe you’re not good in science or in business law and politics. I know somebody who couldn’t be a Doctor or a Lawyer. They’re doing something now that they actually love to do. See, all things come together for the good. That’s how we should be in our life. Not only you and your life, but what about the people around you? You know, if you think that you have no purpose in your life. Let me tell you this. There are several people come up to me and said â€Å"RJ, I don’t have a purpose. Hindi ko na alam anong gagawin ko sa buhay ko.† Let me ask you one thing. If you went through your life full of pain, full of tears and at the end of your life, you actually save somebody’s life, is your life worth living? Is the pain worth somebody’s life? If you could actually save somebody? Can you imagine? If you actually saw somebody nearly gets run over by a car and you dive and get them out of the way over the car? For instance, an example, would that be worth living? You’ve saved somebody’s life. I don’t know. What about this. Let’s say you have a problem in your life and you want to give up now. Imagine, if someone ten years older who’s gone through the exact same thing that you have actually gotten through it and came to you and said, â€Å"You know what, I know how it feels, I’ve been there! I’ve been going through what you are going through now. But I’m still here.† Would that not encourage you? Could that possibly save your life? YES! Is that not a purpose worth living for? And that’s why I believe in you because that is the greatest purpose! Be the change you want to see. And be that person and turn them around. In this world, there’s nothing to be ashamed of or to be scared off. Embrace it! LET†S LIVE! Let’s learn and love our life and nothing can stop us. We’re all going through something. We’re all trying to find that something†¦ that happiness. You can find it. Find what you love to do. I love loving people, I love encouraging people, It’s great! The greatest business in the world. Helping people’s lives to be better and uplift people’s lives. I love it. Now, what do you want to do in your life? Is there something more to your life? Because I found something more to my life and I believe it’s God and you want to know Him too, then it’s fine. The choices are yours. Look at me and my life. I made choices and this is how I am. This is where I am. I live it and I love it. I hope brothers and sisters, you’d remember what I said. You have a choice to either uplift somebody or put someone down. You either have the choice to step towards your goal and dreams or step away going to temporary things. You have a choice to either give up or keep going. GIVE UP or GET UP. When you fail, try again and again and again. You have the CHOICE†¦

Summary&Response Essay Example | Topics and Well Written Essays - 500 words

Summary&Response - Essay Example They spend a lot of time with technology and own gadgets such as iPod and other mobile devices and do most of their activities online. The authors further note that difference between the three categories offers advantages and conflicts. The digital natives have some techniques that captivate the older generation such as creativity in technology but also lack some fundamental aspects such as interpersonal skills. Technology also induces bad traits among the digital natives. Digital settlers are however in a better position to handle the digital natives who rely on online technology for their interpersonal interactions. Even though the digital natives depict different lifestyles from digital immigrants, some of the fundamentals are retained. Shared online music with playlist, for expressing affection, has for example substituted music cassettes with track lists. Acknowledging development that the digital natives have caused and potential improvements, the author notes that the technol ogy use among digital natives must be handled with care because actions on it may either propel or destroy the society. The authors offer a rich description of the digital natives, their distinguishing characteristics from the digital immigrants and settlers, and effects on contemporary technology on the digital natives. This means existence of a gap between segments of the population with respect to use of technology. I agree with the authors position on these themes. First, experience with the digital natives exposes their extreme reliance on technology as they spend a lot of time on related devices. Interaction with them in public places and even in family even illustrates this as they are oftem immerced in the computerized devices, either chating with friends, updating status, or downloading online content. My personal experience in family occasions confirm this as family members, from

Editorial article on school uniform Example | Topics and Well Written Essays - 1000 words

Editorial on school uniform - Article Example â€Å" I like to see girls running around in skirts since currently if you happen to see one in skirts, then they are slutty skirts,† one of the parents remarked (Ryan 2). Moreover, the parents says that they will not accept these changes just like that, but on the other hand they claimed that their precious daughter should continue dressing up in matching jumpers. â€Å"It is a tradition,† some asserted which has developed to a code (Ryan 2). At the same time other parents retorted that they feel immense amount of guilty since the community members will now think that their children are just a quantity of run of the mill magnet kids after they see them after school. Similarly, most of the student fraternity was also unhappy with the decision. A grade 7 girl claimed that the action by some older girls should not have warranted the administration to punish the whole school. According to the students, the uniform did their best to bring equality in the students’ bo dy where all of them looked the same, but however, the administration decision will now ruin that. Moreover, some laid out their feelings regarding the fact that they will not continue wearing their beautiful uniform. Evidently, school uniform is clearly inherent in brings out commonness of the student body. Despite this, some people are strongly against the students wearing school uniforms. Moreover, Brunsma purports that school uniform is actually a good way of improving students discipline in addition to motivating them (3). In addition, he claims that students should wear school uniform for the reason that the school uniform minimizes gang colors as well as inhibits students from wearing clothes that will promote sex and drugs. Consequently school uniform is known for promoting good learning environment. In 1995, Long Beach school reported a dramatic decrease in violence along with discipline cases among the students. This was after one year of adopting mandatory school uniforms . At the same time the school also noticed that the students were actually scoring higher in their tests. The school commented that this was a very great accomplishment. They also found out that the uniforms had taken tall on the student fraternity. Consequently, President Clinton visited the school in 1995 where he urged other schools to also consider adopting the mandatory school uniforms. Clinton said, â€Å" if school uniform will make our children to stop killing each other over designer jackets, it is then crucial for schools to require their students wear school uniforms† (Wilkins 5). Actually, the reports concerning the change in crime in the school district showed that assault had gone down by 67 percent, while vandalism dropped by 82 percent and robbery cases reduced by 35 percent. This supports the fact that school uniforms are inherent for students (Norgard 7). School uniforms also are believed to enhance improved academic achievement. This is depicted by the stud y by Mancini which shows that tests scores of schools which have mandatory uniforms has gone up (27). The similar scenario was also evident in the school district in Long Beach, which has continued to produce test scores which indicate better performance. Moreover, school uniforms promote the educative behavior through reducing distraction and making the classroom to appear as a very serious environment. Clearly, Cohn says that school uniform increases students self esteem, especially the unfortunate ones, as well as it makes

The Power Of American Media Essay Example | Topics and Well Written Essays - 2000 words

The Power Of American Media - Essay Example Even before America gained her independence in the late 18th century, Europe’s tabloid presses were already having a field day exposing sensational events that would put today’s reality media to shame. Stories like the gruesome attack on a businessman and the â€Å"deflouring† of his two daughters appeared in a Dutch pamphlet in 1601 and led to a crackdown on banditry. Tabloid reports on the adulterous escapades of England’s popular Queen almost sparked a revolt in the early 19th century (Economist 107). So powerful were newspapermen that Burke (1729-1797) coined the term â€Å"Fourth Estate† to describe them as a new and powerful social class in England. It was Burke who pointed out the duty of the press as guardians of public interest and watchdogs of government. He believed that newspapermen had a power all their own in government: the power to speak and the power to make others listen through the printed word, and to act as a check and balance to the other social classes (Lords, Clergy, and People) by upholding democracy and defending public interests (â€Å"A Vindication†¦Ã¢â‚¬ ). But it was Carlyle (1795-1881), quoting Burke, who extended the description as to include the â€Å"Able Editors† and printers (â€Å"Heroes†), widening the Fourth Estate as to include the whole mass media. Carlyle, an individualist who vehemently distrusted democracy and legislators and hated industrialists, had in mind William Cobbett, England’s great newspaperman w ho denounced the political system as nepotistic, corrupt, and elitist and had to flee to America in 1818 to escape trial. Returning in 1820, Cobbett reported juicy tidbits of the King’s private life, in the process gaining popular support and acquittal for the embattled Queen.

Finding and Expert and Interviewing Expert Effectively Essay

Finding and Expert and Interviewing Expert Effectively - Essay Example Reviewing the phone book and yellow pages directory can be a good option while searching for experts. Going through the faculty directory can allow the researcher to know about the different expert research studies conducted and therefore can easily find the one most suitable for his or her research. Internet is a vast database of getting out all the available and accessible contacts of the experts. The encyclopedia is another good database for knowing about the relevant organizations and the experts present in them (Ballenger 2009). Once an expert has been found, the researcher or interviewer needs to carefully devise the interview mode so that maximum amount of useful information can be gathered from the experts accordingly and conveniently. The interview mode needs to be decided to find out the best mode of interviewing the expert candidate, the interview modes can be personal interviews, telephonic interviews or email interviews. After deciding upon the interview mode, the interviewer needs to carefully design the questions that will be posed towards the expert for gaining the information. Questions need to be designed systematically and should be made sure that all important aspects are covered for the research. Open ended questions tend to provide more in-depth information and clarification about any certain area. Close ended questions do not provide much detail. Personal experiences of the expert and their reflection are highly important to be incorporated in the research as it gives the study more weight and authenticity. Interview sessions should be regarded as conversations rather than surveys and during these interview conversations the researcher can get maximum detail about his questions. At times informal behavior may be required so as to get maximum details. The researcher needs to make a note of all the information being gathered during the interview session and this can be done

Survey Paper of open-source software and it's use in enterprise and Essay

Survey Paper of open-source software and it's use in enterprise and government - Essay Example Open source software enables businesses and government institutions to access and offer certain services that otherwise would have cost lots money to install and use. This survey paper aims to conduct an in depth analysis of past research literatures on the use of open source servers by enterprises and government organizations. Further, the paper analyzes how these organizations use the open source servers to efficiently perform their activities. Objectively, this survey paper seeks to relate elementary analysis of open source servers in business and government institutions as studied by other researchers in the past. Finally, the paper puts into context all the exclusion as well as inclusion results of the analyzed literature reviews about open source usage in businesses.   As a result of the widely and broad technological improvement and innovations, businesses and government organizations all over the world are in the rash to cope with these changes. It should be noted that the basic aim of any business is to maximize profit while minimizing cost. However, a successful business should also consider long term growth plans through installing an effective business operations system. On the other hand, government institutions may also want to put into place effective service delivery systems to its citizens (Bitzer & Schroder, 2006). The later considerations bring about the importance of integrating computing system into these organizations. There are different types of computer systems and some of them are more sophisticated than others. In addition, some of them have strong variance in their functionalities while others are more or less related. While business and government institutions may afford to use premium computing systems, there has been a growing demand and usage of open source servers. This reality could be attributed to the fact that some of these computing systems are free or cost effective as