Externalities: There can be positive or negative and

are either costs or benefits on economic activity

that affects a third party and not the business that
has created the externality. Negative externalities
are more common and are often considered
spillovers that happen as a result of production of
a new product. One important quality of
externalities is the cost of pollution is not taken
into account by firms. Therefore, social costs can
greatly exceed private costs, making externalities
more detrimental (especially during
overproduction).

Externalities in The Lorax: These appear as consequences in The Lorax.
They include all of the environmental problems created after over-
production of thneeds. As the company grows, so does the pollution
omitted into the water and air. Cutting down the truffula trees wreaks
havoc on the Brown Bar-ba-loots, the Swomee-Swans, and the
Humming-Fishs environment. They have no other choice to leave
because their home has been destroyed. A few more negative
externalities include the decrease of truffula fruits, smogulous smoke,
and Gluppity-Glup.

Analysis: As the Once-lers business grew, he became less cognizant of the effect he
was having on the truffula trees and the environment where they flourished. Instead,
the Once-lers focus was aimed towards mass production of thneeds. The Business is
business, and business must grow quote explains the lack of apathy for the creatures
and environment he was destroying while taking in the truffula tufts to make his
product. Although business production is important, externalities can be the hidden
weapons that cause harm to third parties. In this case, the third parties were the
creatures of truffula forest, and the overall environment that had to pay cost of the
pollution and leave.
Recommendations: The problem with the externalities created by the Once-lers thneed
production is its harm to the environment. However, the cure to this problem is not
just to keep the truffula trees growing, but provide government regulation to the thneed
production and truffula tuft harvesting. There should only be a specific amount of
supply that can be produced yearly to allow enough time to plant more truffula seeds
and keep the trees growing in a sustainable cycle. Prices would then increase due to
the decrease in supply but same demand.


Externalities Today: Today, pollution is
one of the most common externalities in
the economy. Large companies with high
production often have large amounts of
pollution. For example, in China 16.3%
of pollutants come from industrial
emissions. Plus, rising air pollution is
correlated with rising rates of lung
cancer and respiratory disease.

I meant no harm. I most
truly did not. But I had to
grow bigger. So bigger I
got. Once-ler, The Lorax
Pollution:
Sarah Bixler
Israa Khan
Daniel Lieu
Anthony Monzano
Period 2