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NETWORK EXTERNALITIES
Till this point we have assumed that people's demands for good are independent of each other.
Actually, a person's demand can be affected by the number of other people who have purchased that good.
If this is the case, a network exists externality.
Network externalities can be negative or positive.
A positive network exists externality if the quantity of a good demanded by a consumer increases in response to an increase in the purchases by other consumers.
Negative network externalities are the opposite of it.
IMPLEMENTATION OF ECONOMIC POLICIES: Innumerable studies are available to document these failures of policy and planning. However, there are vast differences of opinion conce
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if you were making the pricing decision for the gasoline company, would you cut, raise or leae the price unchanged
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