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McCloskey quote from the (summary) reading today:
Externalities are not simply technological—though without much reflection most economists firmly believe they are. Externalities are defined socially all the way down. If factory smoke became fashionable to breathe, it would stop being a negative externality and would become a positive one.”
...and:
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The technical treatment of externalities does account for that, but it also blows up the standard implementation model for dealing with externalities.
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That reminds me that I keep putting of writing a short primer on externalities.
Magical daddy government isn’t trivial to derive from there either.