Aug 10, 2025 · What Is an Externality? An externality occurs when an activity by one party causes a cost or benefit to another party. These effects can be either negative or positive.

The concept of externality was first developed by Alfred Marshall in the 1890s [1] and achieved broader attention in the works of economist Arthur Pigou in the 1920s. [2] The prototypical …

May 28, 2025 · An externality is an unintended side effect of economic activity that impacts someone not directly involved in the transaction. Think of it as a spillover effect where …

Externalities occur when producing or consuming a good cause an impact on third parties not directly related to the transaction. Externalities can either be positive or negative. They can …

What is an Externality? An externality is a cost or benefit of an economic activity experienced by an unrelated third party. The external cost or benefit is not reflected in the final cost or benefit …

Some argue that wealth itself has an externality: inflaming envy. Others maintain that there are externalities of altruism—when I give money to help the poor, everyone else who cares about …

3 days ago · What Is an Externality? An externality is a cost or benefit that is caused by one party but financially incurred or received by another. Externalities can be negative or positive. A …

Negative externality, in economics, the imposition of a cost on a party as an indirect effect of the actions of another party. Negative externalities arise when one party, such as a business, …

Externalities refer to the cost or benefit experienced by an entity without producing, consuming, or paying for it. It implies that this indirect cost or benefit affects an entity other than its producer …

EXTERNALITY definition: 1. a positive or negative effect for someone else as a result of something that you do: 2. the…. Learn more.