Leslie tries to convince Jessica Newport to donate the Newport land to the national Park Service by reminding her that the Newport name has not always been associated with positive things. For instance when their hot fudge pipe exploded and the hot fudge flowed into the lake making the fish taste delicious. Negative externality or positive externality, you be the judge.
See more: externalities, negative externalities, positive externalities, private benefits, self-interest, social benefits, social costs
The Pawnee Video Dome is failing and going out of business. Leslie is trying to find tax breaks to keep him afloat, but Ron says the market is signaling that the company is not providing enough value to consumers and deserves to fail. If companies provide a social good (like intellectual conversations) then governments may step in and subsidize the production of the service.
See more: bailouts, competition, growth, invisible hand, market exit in LR, positive externalities, product differentiation, role of government, social benefits, subsidies, technology
The pollution from the local factory creates a beautiful sunset, but it also gives people asthma. Ben and Leslie debate whether the beauty of the sunset is worth the tradeoff. Reducing pollution to zero would be extremely expensive, so it’s important to find some optimal level of pollution.
See more: externalities, negative externalities, positive externalities, private benefits, private costs, social benefits, social costs, social incentives, tradeoffs