An uncompensated provision of an ecosystem service (positive externality) or an un-penalized negative effect on the delivery of an ecosystem service (negative externality). An outside force, such as an environmental benefit or cost, not included in the market price of the goods and services being produced; i.e. costs not borne by those who occasion them, and benefits not paid for by the recipients. Some economists suggest that externalities should be internalized, if they are known to have a significant effect on the demand or cost structure of a product, that is, corrections should be made, to allow for externalities when calculating marginal cost. Marginal cost thus becomes a social opportunity cost, or true cost.
EXTERNALITIES
