Business Economics Report: Analysis of Pollution and its Impacts

This report delves into the economic implications of pollution, specifically focusing on negative externalities. It examines how pollution, stemming from sources like industrial activities, affects both the environment and human health. The report highlights that pollution creates external costs, impacting society by affecting air and water quality, and ultimately harming human health and the quality of life. It also addresses the role of government policies and market-oriented strategies in mitigating pollution, including the use of taxes to curb harmful emissions. The report references scholarly articles and sources to support its analysis of the economic impacts and potential solutions related to environmental pollution and its externalities.

Running head: BUSINESS ECONOMICS
Business Economics
Name of the Student
Name of the University
Author note

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Table of Contents
Discussion........................................................................................................................................2
References........................................................................................................................................4

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Discussion
Pollution is an example of negative externalities, which creates external costs to the
society. Thus, other than polluting the air, water and other natural bodies. It affects people by
increasing the burden of the external costs (González & Saarman, 2015). It creates pollution by
affecting the balance between quality of environment and production. It should also be taken into
consideration that it affects the individual business by aggravating the social cost. As the
company faces increasing private costs of production and society also takes the burden of the
external costs of pollution, it influences the social costs as a whole. Thus, the effect in on
individual people and business as well.
The effects of the pollution are wide spread. The air pollution leads to poor air quality
that affects the human health drastically (Hill, 2015). The air pollution rises in presence of
harmful gases such as carbon dioxide and carbon monoxide and damages the human health along
with buildings and crops. Pollutants from the industrial sectors also disrupt the valuable water
resources and harm the indigenous species. The pollutions in water bodies degrades and
contaminated the water, which harm the humans and animals by drinking that water.
As a result, it drops the quality of life drastically. The health of the individuals also get
affected due to pollution. In general, externalities always affect the third party those who are not
part of the exchange, which creates externalities (Agarwal, Kickhöfer & Nagel, 2015).
Moreover, the environmental damage caused by the pollution through high concentration of
greenhouse gases. Thus, the poor air quality and toxic gases influence the vulnerable population
such as elderly and children. It also affects the patients suffering from heart diseases and asthma.

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There are various health ailments which is resulted from the pollution and affects the human
health and quality of life.
There are various governmental policies to protect the environment from the pollutant
emission, which scales down the level of pollution. In addition, the adoption of the flexible
market-oriented policies are also recommended in this regard (Hill, 2015). It helps to reduce
pollution at a lower costs. Another way to curb the harmful greenhouse gas emission in the
environment is through imposition of taxes. As these toxic gases increases pollution and global
warming.

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References
Agarwal, A., Kickhöfer, B., & Nagel, K. (2015). The internalization of congestion and air
pollution externalities: Evaluating behavioral impacts. In 14th International Conference
on Travel Behaviour Research, Windsor.
González, T., & Saarman, G. (2015). Regulating Pollutants, Good Neighbor Agreements, and
Negative Externalities: Who Bears the Burden of Protecting Communities?. Good
Neighbor Agreements, and Negative Externalities: Who Bears the Burden of Protecting
Communities.
Hill, C. A. (2015). The Rhetoric of Negative Externalities. Seattle UL Rev., 39, 517.