Externalities

Externalities are effects of services, products, or production on third parties who were not involved in the buyer/seller relationship. Externalities occur when a third party incurs unintended consequences from the market behaviors of others. Externalities can be either negative (pollution, waste clean-up fees that a community must bear, rather than the generator of the waste), or they can be positive (The Clean Water Act generates positive effects for many who were not involved in enacting the bill).

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