Explain and evaluate economic policies that aim to reduce negative externalities, using an example of either a negative production externality or a negative consumption externality in your discussion. Include a relevant economic model (graph) in your answer.

1 Introduction

• Brief outline of what the essay will be covering (thesis statement) and some context regarding the issues.

2 Explain the concept of Negative Externalities

• Define, explain and give examples of negative externalities.
• Clearly distinguish between negative consumption externalities and negative production externalities.
• Discuss why negative externalities occur and why they are an example of market failure.

3 Specific details and diagram/s related to this topic and Real-world applicatioon

• In more detail explain the negative externality (production or consumption) that you are discussing in the essay.
• Explain the effects of this negative externality specifically referring to inefficiency and market failure.
• Include and explain a negative production or consumption diagram (depending on what you have chosen to discuss).
• Clearly label your diagram
• Define relevant terms.
• Explain your graph referring to specific points on the graph.

• Describe the economic policies aimed to address the negative externality case study you have chosen - identifying the type of policy (for example, command and control or market-based policy), how it works and the purpose of the policy.
• Evaluate the effectiveness (advantages and disadvantages) of each policy with reference to data and evidence to support assertions. When evaluating each policy consider issues such as the ease of implementation, cost of implementing the policy, effectiveness, equity concerns, other issues that impact the effectiveness of the policy.
• Summative comparison of the two (or more) policies?

4 Conclusion

Briefly restate (summarise) thesis and key ideas/points.

Answer rating: 100% (QA)

1 Introduction In this essay we will discuss economic policies aimed at mitigating negative externalities focusing on either negative production or consumption externalities Negative externalities occ... View the full answer