You Are Having a Party and One of Your Guests

question 31

Essay

You are having a party and one of your guests lights up a cigar without asking.Explain why this creates an externality.

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Definitions:

Belief in a Just World

The cognitive bias that assumes people get what they deserve, leading to rationalizing suffering and rewarding.

Good Samaritan Effect

The phenomenon where people are more likely to offer help to others in need without expecting anything in return.

Commons Dilemma

A situation in shared-resource systems where individual users acting independently according to their own self-interest behave contrary to the common good of all users by depleting or spoiling that resource.

Bystander Effect

The phenomenon where individuals are less likely to offer help to a victim when other people are present.