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In this episode of the OoruLabs podcast, Sathya Sankaran discusses urban congestion and pollution, exploring the concept of negative externalities and the various methods to internalize these costs. He delves into the Pigovian tax, Coase theorem, and private solutions, highlighting the complexities and challenges in addressing these issues effectively.
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Keywords
urban congestion, pollution, negative externalities, Pigovian tax, Coase theorem, private solutions, social cost, environmental policy, public goods, market failure
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Takeaways
Severe congestion and pollution in cities prompt discussions on solutions.
Negative externalities affect bystanders who bear the costs of others' actions.
Private costs do not account for social costs, leading to market failures.
Pigovian tax aims to internalize negative externalities for market efficiency.
Achieving Pareto optimality is complex and requires careful calibration.
Coase theorem suggests private negotiations can resolve disputes under certain conditions.
Widespread pollution cannot always be addressed through private solutions alone.
Private solutions can create perverse incentives if not regulated properly.
Public goods often face free rider problems, complicating private solutions.
Technological advancements can help public agencies address environmental issues.
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Sound Bites
"These affected parties are called bystanders."
"Achieving Pareto optimality is hard work."
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Chapters
00:00 Understanding Urban Congestion and Pollution
02:59 The Concept of Negative Externalities
06:02 Methods to Internalize External Costs
08:58 Exploring Private Solutions and Their Implications
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Stock video and picture credits to various contributors. All rights belong to respective owners. Show notes generated by Riverside AI.
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