| Network externalities occur when markets characterized by network effects fail to allocate resources properly. |
| This is epitome of blindness, that mere externalities blind one to reality, even when it is right before one's face. |
| The first is to address negative externalities that aren't reflected in market prices. |
| Governments can set water prices but this will only achieve efficient prices if the environmental externalities can be measured accurately. |
| Traditional externalities, such as limiting the spread of contagious diseases, explain little of modern government involvement with health. |
| The proportion of goods and services that come along with externalities may change over time and differ across countries. |
