Thursday, January 17, 2013

Externalities, Plus A Bit More

You probably have heard of the word “external” but what about “externality”? An externality occurs when a decision causes costs or benefits to individuals or groups other than the person making the decision.  The decision-maker does not bear all the costs or reap all the gains from his or her action.  The term is used in economics and an example of a decision could be water or air pollution.  More laws limit how much pollution (point source) can occur but we know there is mercury in fish because of burning coal at power plants hundreds of miles away.  Pollution in Superior does partly arise from actions in Superior but also from other places via air travel and deposited via rain or other ways. In our society, we have decisions to make every day.  Decisions of an individual or a business can influence their neighbors, the city, or beyond.  Some influences can be beneficial, such as environmental clean-ups or research where more people benefit from the efforts of a person, group, or business.  A Rotary Club or 4-H club might do a clean-up on Wisconsin Point and others would then be able to enjoy the cleaner shoreline.  An externality of a person not picking up their pet’s waste could be that the dog waste is washed down a stormdrain after a rain or as snow melts and it lowers the water quality on the other end of the pipe and leads to closed beaches or algae blooms. 
I’ve always liked food webs and recognizing how extensive a food web can be.  It’s more than a chain as most species can consume different prey.  NOAA has a good Lake Superior Food Web  I like that the drawing is not generic of fish eats fish but shows species right here in Lake Superior.  Before you go to the link can you create a small web of life in Lake Superior?  The little guys we can barely see, such as phytoplankton and zooplankton, are vitally important.  We don’t have the bigger fish without the little fish.  The poster also has the inclusion of several aquatic invasive species which are here in Lake Superior.  Are aquatic invasive species an externality occurring in society?   I listened to a seminar the other day that referred to aquatic invasive species as genetic pollution.  Are we creating this scary problem?  What can we do to prevent the spread of aquatic invasive species? What about invasive species on land?
When putting a new building in what was once a field, more pervious surfaces is added to an area and will lead to run-off.  For ways to reduce run-off go to  Efforts can be made to reduce the run-off but if none are done then more water will be flowing off the new paved and impervious surface.  Good planning can help reduce the effects on places beyond the property.  Putting in a rain garden can be part of the solution to handle the water and also bring a beneficial externality of watching butterflies.  
Society has benefited from some production of medicines to help us fight off an illness.  However, negative externalities arise such as with the amount of extra pharmaceuticals that remain to be disposed of and that the medicines can contaminate waterways as they go right through a treatment plant and some are having effects mimicking hormones.  Plasticizers are another source for the chemicals entering waterways and having health effects on aquatic life.  With proper disposal there is a cost – to the Police Departments, incinerator, and awareness campaigns to promote proper disposal.   Can you think of any externalities – good or bad - on other topics? There are many local and global situations of decisions and behaviors having additional effects on other people and places. 
Written by Wendy Grethen

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