Externalities and Cost of Production in Economics - Part 2

Learn about Pigouvian taxes and emission-based taxation policies in this economics lecture that examines how these mechanisms can internalize negative externalities in markets. Explore how setting tax rates equal to marginal external costs can incentivize firms to reduce pollution to socially optimal levels. Understand the challenges of accurately estimating external costs to implement effective taxation policies. Part of NPTEL's Principles of Economics series, this 39-minute lecture offers certification options that can count toward course credits at Indian universities under UGC and AICTE guidelines.