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Accession Number PB2013-105235
Title Strategic Significance of Negative Externalities.
Publication Date Dec 2012
Media Count 31p
Personal Author M. G. Nagler
Abstract Negative externalities have competitive relevance in a market when they have selective impacts as, for example, when a product in use imposes greater costs on consumers of rival products than on other people. Because managers have discretion over aspects of product design that affect external costs, the externality in such cases may be viewed as a strategic variable. This paper presents evidence of the existence of competitively-relevant negative externalities. I introduce a metric for the externalitys competitive effect, the external cost elasticity of demand, which I estimate econometrically using data from the motor vehicle industry. Managerial implications are considered.
Keywords Consumers
External costs
Motor vehicles
Negative externalities
Network effect
Traffic fatility risk

Source Agency Federal Highway Administration
NTIS Subject Category 85H - Road Transportation
43G - Transportation
85D - Transportation Safety
Corporate Author City College of the City Univ. of New York.
Document Type Technical report
Title Note N/A
NTIS Issue Number 1312
Contract Number N/A

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