ECO 204 Week 4 DQ 1 Externalities

January 25, 2016  |  By  | 

Category: Education Externalities. It has been proposed that toll collection on the Massachusetts Turnpike, a key commuter route into Boston from the west, be discontinued. Proponents argue that tolls have long ago paid for the cost of building the road; now they just provide cash for tax bureaucracy. A number of economists are opposing the repeal of tolls on the grounds that they serve to internalize externalities. Explain this argument and discuss why the government often gets involved when finding solutions for externalities. Respond to at least two of your fellow students’ postings.

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