Kendall Erickson November 16, 2011 Economics 1W â€œLessons Learnedâ€?
Every action that you make comes with consequences. Its consequences might affect only you, or they might affect others as well. When the consequences of your decision affect more than just yourself, they are called externalities. For example, say you choose to smoke around other people. The people around you will breathe in your secondhand smoke and that can be as dangerous as smoking themselves. Say you smoke around an asthmatic; if the person has an asthma attack, they are being affected by your decision to smoke. Externalities, however, aren't all bad. When flu season rolls around and you've been vaccinated, you're unlikely to pass along the virus to others. It's your decision to get the flu shot and it positively affects the people whose decision it was not. It's important to use your head before you make choices of any kind.