Respuesta :
Pigovian tax is the name of a method that is useful in controlling negative externalities and in reducing the use of common resources to the efficient quantity.
How do you control negative externalities?
- By taxing products and services that result in spillover costs, the government can deter negative externalities.
- When a third party incurs expenses as a result of the creation or consumption of a good, this is known as a negative externality. Negative externalities are frequently shown by instances of air and noise pollution.
- Administration action: Government officials can discourage negative externalities and avoid market failure in three different ways: through taxation, regulation, and stricter environmental laws.
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