GED® Social Studies: Macroeconomics, Government & Economic Data › 3. Public Goods, Externalities, and Regulation
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3. Public Goods, Externalities, and Regulation

GED® Social Studies: Macroeconomics, Government & Economic Data · preview lesson

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Government often acts when markets underprovide public goods or create externalities. Pollution is a negative externality because costs fall on people outside the transaction. Regulation, taxes, or incentives can shift behavior toward public goals.

References: Federal Reserve: Monetary Policy; World Bank Open Data

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