Analyze the following statement. Is garbage a positive or a negative externality? Why is a market solution practical here?
Since the turn of the twentieth century, hog farmers in New Jersey fed Philadelphia garbage to their pigs. Philadelphia saved $3 million a year and reduced its garbage mound by allowing New Jersey farmers to pick up leftover food scraps for their porcine recyclers. The city paid $1.9 million to the New Jersey pig farmers for picking up the waste each year, which was about $79 a ton. Otherwise, the city would have had to pay $125 a ton for curbside recycling of the same food waste?