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Ch 9 2.8 Market failure: externalities and common pool resources: complete notes
Neat, exam-ready notebook-style notes for Ch 9 2.8 Market failure: externalities and common pool resources, following the IB Diploma syllabus, SL and HL. This chapter is part of the complete Economics Notes for IB Diploma Students (SL and HL): All 30 Topics.
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Free preview: Ch 9 2.8 Market failure: externalities and common pool resources notes
A quick look at the chapter from our IB Diploma Economics notes. The full chapter notes have the detailed explanations, diagrams and practice questions with answers.
Topics in this chapter
- What you must be able to do
- Socially optimum output AO2 AO4
- The four externalities in the guide
- Negative externalities AO2 AO4
- Positive externalities AO2 AO4
- Merit and demerit goods: summary
- Calculating the welfare loss AO4
- Common pool (common access) resources AO2 AO4
- Responses 1: Pigouvian taxes, carbon taxes and subsidies AO2 AO4
- Responses 2: legislation, education and other tools AO2 AO4
- Strengths and limitations of policies; international cooperation AO3
- Evaluating policies
- Importance of international cooperation
“I can” checklist: what you must be able to do
- I can explain why MSB = MSC is allocative efficiency and maximises community surplus.
- I can draw and explain negative and positive externalities of production and consumption with the welfare loss.
- I can explain merit and demerit goods.
- I can explain common pool resources, the tragedy of the commons and unsustainable production.
- I can draw and explain Pigouvian and carbon taxes, subsidies, legislation and education; describe permits, agreements, collective self-governance, government provision.
- I can evaluate policy strengths and limitations (measurement, effectiveness, stakeholders) and international cooperation.
- HL: I can calculate the welfare loss from a diagram.
What is inside the full chapter notes
- Concept notes with 9 worked examples (every number computed)
- Diagrams: allocative efficiency; the four externalities; common pool resource
- Responses: Pigouvian and carbon tax, subsidy, legal limit, education
- HL page: welfare loss calculations
- Strengths, limitations and international cooperation
- Common mistakes and a "How to score" command-term box
- 12 Quick-check questions A-D, explained
- Paper 1 style (a) 10 + (b) 15 with mark scheme and markbands
- Paper 2 style data response (36 marks) with mark scheme
- HL Paper 3 style policy question (18 marks) with mark scheme
- Quick reference and "I can" checklist
What you get in the pack
- All 30 topics of IB Diploma Economics for students taking Standard Level or Higher Level (first assessment 2022): what economics is, demand, supply, market equilibrium, behavioural economics, elasticity, government intervention, externalities, public goods, asymmetric information, market power, equity, measuring economic activity, aggregate demand and supply, macroeconomic objectives, inequality and poverty, monetary policy, fiscal policy, supply-side policies, international trade, trade protection, economic integration, exchange rates, balance of payments, sustainable development, measuring development, growth and development strategies
- Every syllabus statement covered in order, each marked SL or HL, with clear notes, tables and diagrams drawn for these notes
- Every diagram the guide names, drawn and labelled, plus worked examples and model answers that show how to earn the marks
- Quick-check multiple-choice questions with explained answers, plus original Paper 1 (extended response), Paper 2 (data response) and, for HL, Paper 3 (policy) style questions with full mark schemes (no past-paper reprints)
- Common mistakes and a how-to-score command-term guide for every topic
- Quick-reference sheet and an "I can" checklist at the end of every topic
- Colour PDF and a black and white copy of every chapter for printing
- Independent notes for IB Diploma students; not endorsed by or affiliated with the International Baccalaureate Organization (IBO)
All chapters in this pack
- Ch 1 1.1-1.2 What is economics? and How do economists approach the world?
- Ch 2 2.1 Demand
- Ch 3 2.2 Supply
- Ch 4 2.3 Competitive market equilibrium
- Ch 5 2.4 Critique of the maximizing behaviour of consumers and producers
- Ch 6 2.5 Elasticity of demand
- Ch 7 2.6 Elasticity of supply
- Ch 8 2.7 Role of government in microeconomics
- Ch 9 2.8 Market failure: externalities and common pool resources
- Ch 10 2.9 Market failure: public goods
- Ch 11 2.10 Market failure: asymmetric information (HL)
- Ch 12 2.11 Market failure: market power (HL)
- Ch 13 2.12 The market's inability to achieve equity (HL)
- Ch 14 3.1 Measuring economic activity and illustrating its variations
- Ch 15 3.2 Aggregate demand and aggregate supply
- Ch 16 3.3 Macroeconomic objectives
- Ch 17 3.4 Economics of inequality and poverty
- Ch 18 3.5 Demand management: monetary policy
- Ch 19 3.6 Demand management: fiscal policy
- Ch 20 3.7 Supply-side policies
- Ch 21 4.1 Benefits of international trade
- Ch 22 4.2 Types of trade protection
- Ch 23 4.3 Arguments for and against trade control and protection
- Ch 24 4.4 Economic integration
- Ch 25 4.5 Exchange rates
- Ch 26 4.6 Balance of payments
- Ch 27 4.7 Sustainable development
- Ch 28 4.8 Measuring development
- Ch 29 4.9 Barriers to economic growth and/or economic development
- Ch 30 4.10 Economic growth and/or economic development strategies