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58 Examples of an Externality

An externality is a cost or benefit of an activity that isn't paid by the producer of the activity. This throws off the economics of the situation because the producer won't typically consider the externality in their decision making. Externalities can create irrational situations such as a factory that produces $1 widgets that each create $50 in air pollution. The following are common examples of externalities.
Adding Stimulation to an Area (e.g. billboards that make an area famous and interesting)
Adding to Quality of Life (e.g. a pleasant cafe that improves a neighborhood)
Agricultural Runoff
Air Pollution
Anti-competitive Practices
Antibiotic Resistance
Attracting Crime / Misadventure to an Area
Biodiversity Loss
Construction Dust
Destabilization / Destruction of Landforms
Destruction of Heritage
Destruction of Places of Unusual Natural Beauty
Economic Instability (e.g. promotion of speculative investments)
Environmental Injustice
Existential Risk
Fragmentation of Habitat
Habitat Destruction
Information Overload
Invasive Species
Light Pollution
Marine Debris
Medical Waste
Nanomaterial Pollution
Noise Pollution
Nuclear Waste
Ocean Plastics
Oil Spills
Persistent Organic Pollutants
Plastic Waste
Pleasant Architecture
Political Instability
Political Stability
Pollination by Bees
Privacy Reduction
Production of Cultural Heritage
Promotion of Rights and Freedoms
Providing Public Spaces
Radioactive Waste
Reducing the Aesthetic Appeal of an Area
Reduction in Quality of Life
Reduction in Rights and Freedoms
Resource Depletion
Secondhand Smoke
Soil Degradation
Space Junk
Species Extinction
Systemic Risk
Toxic Waste
Traffic Accidents
Traffic Congestion
Urban Heat
Water Pollution
Workplace Injuries
Workplace Stress
Everything that one does has secondary impacts. Taxing or regulating externalities can have chilling effects that may reduce economic production and quality of life. As such, this may be reserved for major damage such as significant air pollution.

Concrete Example

In Japan, it is common for large trucks to be hired to drive billboards through busy downtown areas of major cities such as Tokyo playing promotional messages over loudspeakers. These trucks emit air pollution, create noise pollution and increase traffic through critical downtown areas. If these advertisers had to pay for these externalities, this activity would likely be prohibitively expensive.

Sustainable Economics

This is the complete list of articles we have written about sustainable economics.
Cascading Failure
Circular Economy
Dollar Voting
Economic Bad
Economic Security
Food Sovereignty
Happiness Economics
Happiness Index
Jevons Paradox
Land Footprint
Market Failure
Missing Market
Moral Hazard
Point Of No Return
Quality Of Life
Race To The Bottom
Uneconomic Growth
Water Security
More ...
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