When an individual or company takes advantage of a negative externality at the expense of wider society, it builds up. When everyone can’t afford not to take advantage of the same thing, the problem just grows - often the problems start to compound superlinearly.
They could for example maximize value by dump garbage in other people’s back yards or nuclear waste in other people’s lakes etc. At the very least, it should be disclosed publicly and honestly.
It is often the case that A and B voluntarily make a deal together (eg Snapple shifts to plastic bottles) but it may cost C a lot downstream. And as these negative externalities accumulate, they come back to haunt A and B, and all of society.
People acting in their own individual self interest, at the expense of others, can often lead to a tragedy of the unmanaged commons.
EGreg|2 years ago
When an individual or company takes advantage of a negative externality at the expense of wider society, it builds up. When everyone can’t afford not to take advantage of the same thing, the problem just grows - often the problems start to compound superlinearly.
They could for example maximize value by dump garbage in other people’s back yards or nuclear waste in other people’s lakes etc. At the very least, it should be disclosed publicly and honestly.
It is often the case that A and B voluntarily make a deal together (eg Snapple shifts to plastic bottles) but it may cost C a lot downstream. And as these negative externalities accumulate, they come back to haunt A and B, and all of society.
People acting in their own individual self interest, at the expense of others, can often lead to a tragedy of the unmanaged commons.