Hi, according to Kognity, online IB textbooks, Common Access Resources are an example of a negative externality of consumption, and not production, since the resources do not have a price (and so MPC = MSC, right?); would it be fine to use either negative externality of production/consumption diagrams, when faced with this question for the IB exams?
Hi! The problem of common access resources itself is a problem of overconsumption or unsustainable use of the resource itself. You can draw the negative externalities of production diagram when talking about a product that uses a common access resources as an input, for example sushi is overproduced and this overproduction imposes a negative ext of prod (which is the unsustainable overuse of the resource like salmon and tuna)... So you can draw a neg ext of prod diagram if it shows a production activity that uses this common access resource...
dude.. u need so much more credit... your videos are legendary...
Thank you very much Ramy, I'm glad you find them useful. I'm creating them for my IB Eco students next year... Your feedback is much appreciated!
Hi, according to Kognity, online IB textbooks, Common Access Resources are an example of a negative externality of consumption, and not production, since the resources do not have a price (and so MPC = MSC, right?); would it be fine to use either negative externality of production/consumption diagrams, when faced with this question for the IB exams?
Hi! The problem of common access resources itself is a problem of overconsumption or unsustainable use of the resource itself. You can draw the negative externalities of production diagram when talking about a product that uses a common access resources as an input, for example sushi is overproduced and this overproduction imposes a negative ext of prod (which is the unsustainable overuse of the resource like salmon and tuna)... So you can draw a neg ext of prod diagram if it shows a production activity that uses this common access resource...