For something that is long term, but only effects the property of 1 person, like the field example, the market prices it in and it’s not an externality.
No one is significantly incentivized to stop climate change, because no one person bears a significant fraction of the damage caused.
Politicians are far from perfect, but at least they have any incentive to tackle these big problems at all.
Well if it affects one plot of land that is currently the property of just 1 person it can still be an externality because lots of different people will own this land in the future.
It could be an externality, if the land was randomly reassigned a new owner every year or something. But if the land is sold, that is taken into account. It isn’t an externality. Capitalism has priced this effect in.
For something that is long term, but only effects the property of 1 person, like the field example, the market prices it in and it’s not an externality.
No one is significantly incentivized to stop climate change, because no one person bears a significant fraction of the damage caused.
Politicians are far from perfect, but at least they have any incentive to tackle these big problems at all.
Well if it affects one plot of land that is currently the property of just 1 person it can still be an externality because lots of different people will own this land in the future.
It could be an externality, if the land was randomly reassigned a new owner every year or something. But if the land is sold, that is taken into account. It isn’t an externality. Capitalism has priced this effect in.