Economic Commentary, Title of Extract: China to Release More Data on Air Pollution in Beijing

Authors Avatar

Economy Internal Assessment

Economic Commentary number:

Tile of Extract: China to Release More Data on Air Pollution in Beijing

Source of Extract: The New York Times

Date of Extract: January 6, 2012

Word Count: 749

Date of the Commentary was written: 10/22/2011

Section of syllabus to which the Commentary relates: 1.1

Candidate Name: Harry Tse

Candidate No.

China published more details of air quality data on Beijing, a critic said government Underestimate the seriousness of the problem of air pollution. News from Twitter said that Beijing’s “blue sky days’’s air quality is still poor compared to the United States. Traffic jams and smog in the capital made the public mad and caused damage to the city’s leaders.

Beijing’s air pollution is mainly from using of cars and the production of the factors. The air pollution in Beijing is a negative externality. Negative externality is cause by over consumption or production which outcome a spilled over negative effect which affected the third party, in this case which is the whole society in Beijing. The consumers of use of cars are consuming at the marginal private benefit instead of the marginal social benefit, which include the cost of the air pollution they produced by consuming the use of cars. When, market failure exists. A simply diagram can explain this clearly:

Join now!

Market of use of car

In above diagram, it shows the market of consumption of use of car. Under free market condition, consumers will consumption at P*Q*(MPC=MPB). However, the social optimum level is P1Q1. It’s because consumers ignore the negative externality from their consumption of the use of car to the whole society of Beijing. MPB > MSB, market failure exists as a result (yellow area).  

As stated in the article, air quality in Beijing has been over declining. Its air condition has been poor polluted by both over consuming of use of cars. This ...

This is a preview of the whole essay