Policy Essay Example | Topics and Well Written Essays - 2250 words

Policy - Essay Example In essence, externalities are the effects of production or consumption of products and the outcome is passed to the society. However, the society has little to control these externalities. The first positive externality is technological improvement. Some firms have been on the frontline in investing in technology. The firms ensure they have the best technology to assist in production of their products. As such, these products are enhanced to give ultimate services to the people that need them. In such a position the firms are acting as a positive accrual to other firms. Other firms are likely to benefit from this technological improvement (Barr, 45). When there is change in one firm’s technology, the other firms are likely to benchmark this opportunity. As such, they will purchase other machinery that conforms to the stated technology. These industries and firms will have an improved way of producing products and they will extend the positivity to other firms, which are not pa rticularly involved in the production. When there is an improvement in technology, there are various aspects which are improved in the society. For instance, when there is enhancement in technology, it is considered that pollution is likely to reduce. When the pollution is reduced, there are various aspects which are improved in the society. For instance, the society does not feel the pinch of having to inhale clean air. As such, their health status is maintained. This reduces any expenses that are incurred by the society in terms of treatment for complications in their health (Barr, 123). Similarly, it is guaranteed that there will be lower water pollution. As such, the society will have better water services. The water pollution will be reduced in the society, which gives the whole society clean water to use. It is evidently seen that the society did not incur any costs in the acquisition of technology. However, they are getting better water which is clean and hygienic. The same a pplies to the other firms. Initially, the firms did not incur any costs in getting information about the new technology. However, they are now in perfect shape in preventing pollution. A negative externality in production is pollution. Pollution is one of the most threatening aspects in production. During production, many firms exhale and release dirty water and air. This dirty air and water has various effects on the environment. First, dirty air makes the environment unpleasant to live in. This makes the life of other people uncomfortable. When people are not living in a comfortable environment, it is not entertaining. As such, the people will have to make sure they get solutions to these problems that are instigated by pollution from production firms. Apparently, some firms take it as their own initiative to stop pollution. This is an ideal approach in stopping pollution in the world. When all the firms initiate strategies that will reduce pollution, there is a likelihood of havi ng a better environment that is not affected by the negativities of pollution. It is a prudent approach by the governing bodies to ensure that pollution is reduced in the whole world. With technological improvement, scientists have considered that pollution is one of the negative effects in the world (Barr, 65). For instance, pollution is responsible for global warming. The global warming effect has affected many parts of the world and they are looking for strategies of reducing its effects to the world. This creates a scenario