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ENVIRONMENTAL EXTERNALITIES

Statistics Directorate    
French Equivalent: Externalités écologiques

Definition:
Environmental externalities refer to the economic concept of uncompensated environmental effects of production and consumption that affect consumer utility and enterprise cost outside the market mechanism.

As a consequence of negative externalities, private costs of production tend to be lower than its “social” cost. It is the aim of the “polluter/user-pays” principle to prompt households and enterprises to internalise externalities in their plans and budgets.

Source Publication:
Glossary of Environment Statistics, Studies in Methods, Series F, No. 67, United Nations, New York, 1997.

Cross References:
Economic instruments
Polluter-pays-principle

Statistical Theme: Environmental statistics

Created on Tuesday, September 25, 2001

Last updated on Tuesday, March 04, 2003