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EXTERNALITIES, PRICES AND TAXES: SECOND BEST ISSUES IN TRANSPORTATION. IN: THE FULL COSTS AND BENEFITS OF TRANSPORTATION: CONTRIBUTIONS TO THEORY, METHOD AND MEASUREMENT

A. Myrick Freeman

Open publisher page 1 citations

Abstract

The focus of the paper is on negative externalities rather than on underpricing of transportation services to users. It refers to products and emissions in a generic sense, but it also presents producers as drivers of automobiles and emissions as air pollutants. After a review of the basic theory of externalities, the paper considers the use of taxes on output when it is the output that causes externality damages, and taxes are used on surrogates such as output when emissions cause damage. Some additional second best pricing issues are raised; and the treatment is general and abstract throughout the paper to bring out general principles, not the details of policy implementation.

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What this paper is about

The focus of the paper is on negative externalities rather than on underpricing of transportation services to users. It refers to products and emissions in a generic sense, but it also presents producers as drivers of automobiles and emissions as air pollutants. After a review of the basic theory of externalities, the paper considers the use of taxes on output when it is the output that causes externality damages, and taxes are used on surrogates such as output when emissions cause damage. Some additional second best pricing issues are raised; and the treatment is general and abstract throughout the paper to bring out general principles, not the details of policy implementation.

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OpenAlex reports 1 citations for this work. Citation counts describe recorded attention and do not establish research quality.

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Available abstract

The focus of the paper is on negative externalities rather than on underpricing of transportation services to users. It refers to products and emissions in a generic sense, but it also presents producers as drivers of automobiles and emissions as air pollutants. After a review of the basic theory of externalities, the paper considers the use of taxes on output when it is the output that causes externality damages, and taxes are used on surrogates such as output when emissions cause damage. Some additional second best pricing issues are raised; and the treatment is general and abstract throughout the paper to bring out general principles, not the details of policy implementation.

Key concepts: Externality, Damages, Economics, Public economics, Microeconomics, Natural resource economics, Environmental economics, Industrial organization

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EXTERNALITIES, PRICES AND TAXES: SECOND BEST ISSUES IN TRANSPORTATION. IN: THE FULL COSTS AND BENEFITS OF TRANSPORTATION: CONTRIBUTIONS TO THEORY, METHOD AND MEASUREMENT — Research Paper | ScholarLens