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externality

Impact on any party not involved in a given economic transaction or act

EntityQ275372

Also known as externalities

Subclass of: effect
, public policy failure

Overview

From Wikipedia, the free encyclopedia · Read full article · Text CC BY-SA 4.0

In economics, an externality is a cost or benefit to an uninvolved third party that arises as an effect of another party's activity. Many externalities can be considered as unpriced components that are involved in either consumer or producer consumption. Air pollution from motor vehicles is one example. The cost of air pollution to society is not paid by either the producers or users of motorized transport. Water pollution from mills and factories are another example. All (water) consumers are made worse off by pollution but are not compensated by the market for this damage.

Overview

All data

33 statements · 27% with external sources · numbers in brackets are citations

Facet of: control system relative to: feedback
economic system

On other databases

29 identifiers linking externality across the web's reference databases

Data quality

statements

27%

externally sourced

Source last edited September 24, 2026. AIDB refreshes this page daily.

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AIDB. (2026). externality (Q275372). Retrieved from https://aidb.si/e/externality-Q275372