Pigouvian Taxes in Economics

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  • Опубликовано: 16 окт 2016
  • This video discusses the concept of a Pigouvian Tax in economics. Pigouvian taxes are a corrective tax that are used to address market failures brought about by a negative externality (e.g., smoking). By setting a per-unit tax equal to the marginal external cost (the cost to people other than the smoker), one can achieve the socially efficient outcome (the optimal amount of smoking, considering the costs and benefits of all people in society). This video uses a graph to show a Pigouvian tax yields the socially efficient quantity of a good or service. The video also discusses the double dividend of Pigouvian taxes: in addition to bringing about the socially optimal outcome, Pigouvian taxes also yield tax revenue that can be used for other projects.
    This video was funded by a Civic Engagement Fund grant from the Gephardt Institute for Civic and Community Engagement at Washington University in St. Louis.
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Комментарии • 34

  • @nope34
    @nope34 7 месяцев назад

    very cool!!! Thank you so much for your explanation. Sitting in class for 1h30min I just could not make sense anything, watching you explained just cost me 11:02 minutes! thank you!

  • @thomasscheicher9779
    @thomasscheicher9779 4 года назад +2

    Super erklärt! Thanks for uploading your video

  • @SznycluPL
    @SznycluPL 4 года назад +2

    very nice explanation, thank you

  • @damianrodriguez2972
    @damianrodriguez2972 6 лет назад +12

    Pigouvian taxes correct the presence of a deadweight loss. When the Social costs are higher than the associated parties' private costs, it's a market failure that causes deadweight loss. For example, there's an oil refinery in between my house and SLC. It smells terrible and makes the commute unpleasant; that is a negative externality of oil production, and someone who doesn't consume oil will bear that social cost without any benefit. That's the market inefficiency that taxation corrects.

  • @taconydorgeson7053
    @taconydorgeson7053 5 месяцев назад

    good explanation from you, thanks

  • @ryanwillis2513
    @ryanwillis2513 5 лет назад +9

    I’m studying criminal economics and I finally understand so much

    • @moribundmurdoch
      @moribundmurdoch 3 года назад +2

      Criminal economics sounds like a great class for a chaotic evil DnD character to take.

  • @alexmustata4089
    @alexmustata4089 2 года назад +2

    Thank you, very nicely explained

    • @Edspira
      @Edspira  2 года назад

      Glad it was helpful!

  • @maryshenoda
    @maryshenoda Год назад

    thank you so much!

  • @uhhhohhh5926
    @uhhhohhh5926 5 лет назад +18

    Chef John is that you???

    • @sando619
      @sando619 5 лет назад +1

      Dude omg youre so right LOL

    • @Edspira
      @Edspira  5 лет назад +3

      HA, I'm a fan of Food Wishes too!

  • @sanchimittal9139
    @sanchimittal9139 2 года назад

    nice explanation

  • @aminaabouelenien9661
    @aminaabouelenien9661 4 года назад

    what is the difference between a Pigouvian subsidy and a subsidy given to producers equal to the quantity they produce?

  • @4Jamo
    @4Jamo 2 года назад +3

    That was sooooo helpful, hopefully I ace my econ. exam in 3 days :|

    • @Edspira
      @Edspira  2 года назад +1

      Good luck!

    • @4Jamo
      @4Jamo 2 года назад

      @@Edspira Thanks:)

  • @umersujra477
    @umersujra477 6 лет назад +2

    What are the difference between corrective tax and pigouvian tax....?

  • @Anonymos185
    @Anonymos185 4 года назад +27

    Top 10 videos libertarians don't want you to see

  • @StephenJStoeckert
    @StephenJStoeckert 4 года назад +3

    Yang Gang

  • @rosalynlukasik3438
    @rosalynlukasik3438 7 лет назад +1

    Does the pigouvian tax therefore create a deadweight loss?

    • @hebti895
      @hebti895 7 лет назад +2

      No, it's the goal. I mean, there is a deadweight for the private actor. But the social surplus increase.

  • @ThePeterDislikeShow
    @ThePeterDislikeShow 3 года назад +4

    I think we need a pigovian tax on anything that might spread COVID. Travel (e.g., on gas or airline tickets), restaurant meals if eaten on premises, and/or offer subsidies on delivery, online school instead of going in person.

    • @andrewxu3602
      @andrewxu3602 3 года назад

      Policymakers often make societally inefficient decisions, not because they're ignorant, but because it'll help them get elected by people who don't know anything about economics.

    • @jewelciappio
      @jewelciappio 3 года назад

      Authoritarian. You want a tax on something that MIGHT. That’s nazi level.

  • @sinistril
    @sinistril 6 лет назад +4

    Pigouvian tax is such a huge economic fallacy.... but hey, whatever lines government coffers.

    • @moribundmurdoch
      @moribundmurdoch 3 года назад +2

      Please explain why it's an economic fallacy - we're here to learn.

    • @ignacioandresv3170
      @ignacioandresv3170 3 года назад

      @@moribundmurdoch He probably said it because most of the time this tax is nonexistent and you're forced to live with that market failure.

    • @jewelciappio
      @jewelciappio 3 года назад +1

      It makes more sense in a system where there are no other taxes. No federal, no state, no property, sales, luxury, estate, etc.