A negative externality or spillover cost occurs when

4.2.2 The Specification of the Technology

Whenever spillover effects from other industries are present, the estimation of cost reduction is possibly flawed. This is often problematic when technological concepts originate in other industries (e.g., gas turbine having its roots in jet engines). Also, the design of a technology might change in the course of product diversification and the establishment of a technology in new (e.g., distributed) applications.

The attribution of learning and accumulating experience also depends on which technology one actually examines. For example, the outcome when the experience collected with solar photovoltaic power generation is aggregated over all semiconductor materials that have been used for the purpose is drastically different from that when just the currently prevalent material is included in the experience measure. This phenomenon is highly technology specific, and no general recommendation can be given.

Related Concepts

Closely related to the concept of a commons is the economist's concept of externalities (sometimes called spillover effects). An externality is a cost or benefit imposed on others (without compensation) as the result of some economic activity. Externalities can be positive (e.g., a homeowner paints her house to protect it from the weather, and neighbors enjoy the color scheme) or negative (smoke from the homeowner's fireplace chokes her neighbor). Users of common property resources impose negative externalities by reducing the stock of the resource available to other users. Environmental pollution is another common example of a negative externality. In this case, the quality of a resource, rather than the quantity, is reduced by pollution.

Another related economic concept is that of social cost. When a negative externality occurs, the agent that causes the externality incurs a personal cost (his or her private cost) that is less than the total social cost of the activity.

Yet another notion is that of free riders. When the users of a common resource agree to limit their individual impacts, others – the free riders – may continue to exploit the resource. Examples include poachers who illegally slaughter wildlife in protected areas, or nations that fail to ratify or honor international agreements. The dilemma here is that the greater the success in managing the commons, the greater is its attraction to free riders. The problem of free riders explains the dual difficulties inherent in community control of the commons: exclusion of outsiders, and control of cheating by insiders. The failed experiments of national communism serve as strong warnings against undue optimism in these situations.

A basic theoretical prediction of economics, that competitive equilibria are Pareto efficient, is valid only in the absence of externalities. How to remedy the effects of negative externalities is the subject of welfare economics. The immense literature in this field cannot be succinctly summarized, but it can be stated that no fully satisfactory solution to the tragedy of the commons (negative externalities, if you prefer) has been discovered, and it may be that none exists. If not, the commons dilemma promises to become ever more serious as the world's population continues to grow and exert increasing pressures on the biological systems that are essential to our very survival.

Coexistence Due to Spillover

If a species can persist in one local community, then with emigration, it can also be found in other nearby communities where otherwise it would be excluded. To model this “spillover” effect, assume that the species when rare declines at rate r<0 because of competitive exclusion but immigrates from an external source at rate I. Its local dynamics are described by dN/dt=I+rN, which implies N⁎=I/|r| at equilibrium. A species that should be absent, considering only local interactions, may not just persist but even be abundant if there is a large rate of immigration (e.g., from a productive source habitat into an unproductive habitat), and the rate of exclusion is slow. In this scenario, the answer to the species coexistence problem ultimately requires analyzing population dynamics at the appropriate spatial scale, larger than the local community; spatial niche partitioning at this larger scale is responsible for coexistence.

IX.C.1. Spillover Effects

If a species can persist in one local community, then with emigration it can also be found in other nearby communities in which otherwise it would be excluded by local interactions. To model this “spillover” effect, assume the species when rare declines at rate r < 0 because of competitive exclusion but immigrates from an external source community at rate I. Its local dynamics are thus described by dN/dt = I + rN, which implies N* = I/∣r∣ at equilibrium. A species which should be absent, considering only local interactions, may not just persist but even be abundant if (i) there is a large rate of immigration (e.g., from a productive source habitat into an unproductive habitat) and (ii) the rate of exclusion is slow. In this scenario, the answer to the species coexistence problem ultimately requires analyzing population dynamics at the appropriate spatial scale, larger than the local community; spatial niche partitioning at this larger scale is responsible for coexistence.

1.2.3.2 Theory of economic externality

The theory of economic externality was originally put forward by Marshall. The essence of this theory is to reflect that, in market economy, the parties do not bear all the consequences of their own economic activities; in other words, to the theory reflects the spillover effect of economic activities (Marshall, 1890). The externality theory of resource utilization reflects the fundamental reason for the low allocation efficiency of resources under the market economy conditions. It is independent of decision-making control and market mechanism and is unavoidable and difficult to eliminate.

Under the premise of the externality of the market economy, the market often fails, that is, the market price cannot regulate the efficient allocation of resources, which keeps the allocation of resources from reaching the Pareto optimum (Brock & Xepapadeas, 2010; Capello & Faggian, 2002). On the one hand, when the parties engage in relevant economic activities, there is always a certain spillover of economic benefits, while the beneficiaries of indirect economic benefits do not need to pay fees, which makes the economic effects low. On the other hand, when the economic activities of the parties show negative externalities, that is, the economic activities cause economic losses to others, the parties are not required to compensate for the losses. Eventually, this leads to inefficient economic efficiency.

Under the above circumstances, it is far from enough to rely solely on the market mechanism to adjust the allocation of resources. Therefore forces outside the market are needed. The common mechanisms include public opinion and administrative intervention (Helmsing, 2001; Zuo, 1994), among which administrative intervention can be divided into the following five aspects: legal control, the collection of sewage discharge fees, sewage tax, sewage discharge license, and clear property rights.

4.5 Exemplary cases

Research has investigated cases where the effects of weather extremes are not limited to the narrow spatial and temporal windows in which they occur, to mention the consequences of the cyclone Nargis in Myanmar 2008 and other tropical storms in Bangladesh, Haiti, and the Philippines, or the drought in Somalia and other parts of East Africa in 2010–11 (Brzoska, 2017). Conflicts can spread with spillover effects across borders and propagate through chains and feedbacks on various spatial and temporal scales. In turn, conflict can increase disaster risk, as state structures and social systems weakened by conflicts are more sensitive and less able to respond to climate extremes which without conflict could be contained. For instance, weather extremes affecting major food producers can induce rising food prices and riots elsewhere, as experienced during the Arab Spring in 2011, when harvest losses occurred in grain exporting regions following heat waves in Russia or droughts in China and elsewhere in 2010, a causal chain that is debated (Johnstone and Mazo, 2011; Sternberg, 2012). Darfur, Sudan, and the Lake Chad region have been described as examples where climate extremes and conflicts are connected to social fragmentation and fragility disrupting the livelihoods, safety nets, infrastructures, and basic services important for disaster resilience (Mitra and Vivekananda, 2015; Okpara et al., 2015).

Externalities

The mere existence of public goods is not sufficient for the occurrence of a market failure. The deterioration of environmental quality decreases the utility also of noninvolved people, for example, due to a worse health state. A so-called external effect, externality, or spillover effect exists. When valued in monetary terms, the externality is termed external cost. They are defined here as follows: an external cost arises when the social or economic activities of one group of persons have an impact on another group and when that impact is not fully accounted, or compensated for, by the first group. Note that in the definition just given a group of persons could also consist of one person only.

Externalities are due to the activity of a producer (e.g., energy supplier and agronomist) or a consumer (e.g., car driver). Examples include impacts due to fine particulates, noise, or nonoccupational accidents (effects of producers or consumers on consumers) as well as effects of agricultural pesticides on beehives, or effects of residential or industrial sewage effluents on fish stocks (effects of producers or consumers on producers).

External effects can also be positive. Your enjoyment from the beautiful garden of your neighbor is one example. Emissions can also cause positive externalities. Greenhouse gases can lower the chill-induced mortality rate in industrial countries of the temperate zone due to global warming in the short term. SO2 and NOx have a fertilizing effect on crops at low doses. Despite their existence, the magnitude of these positive externalities is generally negligible or at least small compared to the negative ones.

3 Effect of Catalyst and Electrical Contact Materials

The addition of a noble metal, such as platinum, palladium, gold, or silver, to the structure of the metal oxide increases the sensitivity and the selectivity of the sensor and reduces the optimal operating temperature [58]. Yamazoe [45] has proposed a model to describe the effect of a noble metal catalyst in contact with a semiconducting metal oxide. Both chemical and electronic mechanisms have to be considered. The chemical contribution is due to the so-called spillover effect of the gas molecules on the surface of the oxide. This increases the rate of oxidation of the gas and reduces the concentration of adsorbed oxygen species, while the catalyst dissociates the gas molecules enabling them to react with the adsorbed oxygen species.

An electronic interaction occurs between a noble metal particle and the surface of the tin dioxide grain as a result of the difference between the work function of the metal and the electronic affinity of the semiconductor [59]. This leads to oxidation of the metal and hence a variation in the oxidation state of the tin dioxide and the formation of a depleted region inside the grain. The effect is usually associated with platinum and gold, whereas palladium and silver tend more readily to form the stable compounds palladium oxide and silver oxide [4, 7, 45]. In the case of carbon monoxide, the presence of both platinum and palladium increases the sensitivity, particularly at low temperature (275 °C), and reduces the temperature at the maximum sensitivity from over 350 °C to below 300 °C [7, 33].

The total electrical resistance is the result of the contributions from several components: the semiconductor layer, comprising the surface, bulk, and grain boundary components; the substrate on which the metal oxide film was deposited; the electrical contacts; and any catalyst added to increase the sensitivity and the selectivity. A typical sensor can be represented as an ohmic resistance for which the relation between current and potential is linear. The electrical contacts are metallic and are usually made of platinum or gold. The presence of a metallic contact on the tin dioxide layer causes the formation of a Schottky barrier at the interface between the metal and the semiconductor due to the higher work function of the metal compared to the oxide. The contribution of the contacts can, thus, be represented by a diode with nonlinear current–voltage characteristics.

Design Principles for Property Rights Structures

Bundling LME resource attributes within spatial boundaries raises several questions regarding geographical scale and what logically belongs in a bundle from the perspectives of ecology, economics and sociocultural theory. Co-existence and co-evolution of marine species and the chemical and physical surroundings are important considerations so as to control losses from ‘externalities,’ or ‘spillover effects.’ By externalities, economists are referring to situations in which interdependence between production practices and people's welfare (‘utility’) are exogenous to the decision makers.28 In other words, entitlements intermingle owing to an inability to completely delineate property rights because it is too costly or because of institutional constraints (Cheung 1970, Russell 1994). Although positive externalities are equally germane, externalities that damage the property interests of others receive the most attention. For example, otter trawl and dredge fishing tear up lobster pots and other types of fixed gear. However, groundfish and scallop fishermen have no incentive to restrict their fishing practices or to invest in different technologies (hook-and-line fishing for cod or cage culture of scallop) when fishing grounds and/or lobster stocks are non-exclusive.

The Coase Theorem (Coase 1960) teaches us that externalities do not result in a misallocation of resources (aside from wealth effects) in a Utopian world of perfect knowledge, zero transactions costs and complete property rights assignments to all resources. Where externalities crop up due to changes in technology or peoples’ preferences, property rights are exchanged in order to maximize total net value. In reality—and this is certainly the case for the nascent assignment of property rights in an LME—the transactions costs of delineating resources (e.g., costs of information) and negotiating and enforcing new contracts can preclude exchange. Thus, it is prudent to consider ways to bundle LME resources that are consonant with today's ecological and socioeconomic information but are also flexible to change.

First, the 64 vast LMEs probably can be subdivided into smaller areas in order to incorporate principal interactions among attributes and reduce externalities. The division could be based on physical features that ‘enclose’ enduring species assemblages of marine species (marine communities) over time and that largely entrain energy flow and nutrient recycling across trophic levels. The physical features may be geologic, such as trenches or deep water slopes that limit seasonal migrations, or oceanographic, such as areas where upwelling or eddies occur. For example, scientists divide the Northeast Shelf Ecosystem into four sub-systems: Georges Bank, the Gulf of Maine, Southern New England, and the Mid-Atlantic Bight (Sherman et al. 1996). Competitive or mutually exclusive uses of the same areas—potentially, minerals extraction, transportation and/or endangered species protection—could be accommodated through contracts, litigation or ‘combination sales’ (Demsetz 1967). For example, the National Audubon Society has managed bird sanctuaries, cattle grazing and oil production at its Rainey Wildlife Sanctuary in Louisiana where the public is excluded (Baden and Stroup 1981).

Moving in the other direction on the spatial scale, whole sub-systems might be sub-divided into parcels of same uses or zoned for different uses based on smaller landscape or seascape features, but geopolitical lines (e.g., state waters in the United States) probably are arbitrary criteria, and fragmentation of communities and habitat requirements would be counterproductive if it substantially interfered with the basic ecosystem functions of energy flow and nutrient cycling (Costanza and Folke 1996).

Scale also has socioeconomic and geo-political determinants that will affect design. The cost of monitoring and enforcing property rights will be a function of scale, and monopoly power in markets for LME goods and services would be illegal. Dividing LMEs into smaller units might help resolve or minimize transboundary disputes with other countries where resource attributes are mostly fixed in their location and can be zoned or otherwise allocated among users.29

Coexistence is only a necessary, not a sufficient, condition for bundling LME resource attributes. Strong complementarity and separability should also be guides when deciding what resources to bundle in a geographic area. User groups’ local classifications (e.g. commonly known fishing grounds) also need to be taken into consideration. Joint ecologic relationships that have co-evolved to a high degree of specificity over time, such as species-specific predation, commensalism, and habitat dependence, are strongly complementary and, therefore, should justify inclusion in a bundle. Special attention should be given to possible cascade effects (see Christensen et al. 1996).

Unions made on the basis of joint ecological relationships should be overlaid by technology to see where joint production by fishing gear or interactions with other technologies (e.g., sand and gravel mining) might combine ecological bundles. For example, in their study of the New England multi-species trawl fishery, Kirkley and Strand (1988: 1291) rejected the hypothesis of non-joint production of several groundfish species, including Atlantic cod and haddock, and concluded that ‘[m]anagement of one species independent of other species or of an aggregate output will not prevent overfishing or economic waste.’

In contrast to jointness, strong separability implies ecologic independence among resources and, in economics, an ability to substitute environmental inputs in order to produce different outputs. Ecological separation of species populations with closely related niches—i.e., competitive exclusion—is a criteria for separate bundles provided technologic interactions are minimal. In stark contrast, ‘regulatory bycatch’—a political economy artifact of single-species thinking (e.g., groundfish and lobster caught in sea scallop dredge gear)—defies any ecologic-economic rationale for separability.

The rationale for using observed technology to determine resource bundles needs to be qualified. The technologies we observe in fisheries reflect the mostly non-exclusive history of marine resources that created incentives for rapid capture of target species. Institutional change that includes property rights will change investment decisions, conceivably to technologies that are more selective and less destructive of habitat. For example, production of the Japanese scallop increased over 30-fold after fisheries cooperatives in Japan substituted fixed gear culture technology for dredging.

4.4 Regulating services related to pollination and biocontrol

We studied the role of landscape heterogeneity for three regulating services related to mobile species: pest biocontrol and pollination by wild bees.

Forest edges represent overwintering sites for different auxiliary species in the VCG, in particular carabid beetles (Roume et al., 2011) and aphidiphagous syrphids (Arrignon et al., 2007; Raymond et al., 2014). Natural enemies overwintering in these edges later colonize crop fields through spillover effects (sensu Blitzer et al. 2012) in the following spring (Alignier et al., 2014). Grasslands and hedgerows (Alignier et al., 2014), as well as crop fields (Raymond et al., 2014) can also represent overwintering sites for auxiliary species in VCG. These findings call for the need to assess how agricultural practices (tillage, pesticide spraying) applied during autumn influence the overwintering of these auxiliary species and their contribution to pest control (Raymond et al., 2014). This is all the more important given our recent finding that local agricultural practices have the potential to counteract the beneficial effects of landscape elements that promote biological control, including in the VCG (Ricci et al., 2019). Moreover, in comparative studies with two others LTSER sites, we showed that two omnivorous carabid species (Poecilus cupreus and Anchomenus dorsalis) were more abundant in oil seed rape than in cereal fields and in landscapes with a higher proportion of oilseed rape in the previous year (Marrec et al., 2017). Thus, by coordinating crop rotation, farmers may be able to favour the presence of natural enemies in a given field at the appropriate time (Vialatte et al., 2019).

To investigate wild bees response to landscape heterogeneity, we used a functional approach based on traits that determine resource-use by wild bee species. In VCG, landscapes dominated by crops have wild bees communities that are mainly composed by species with high dispersal capacities, nesting above ground (thus less affected by soil perturbation in crops), and which flying early in spring and thus can forage on early flowering crops like oilseed rape (Carrié et al., 2017a). Additionally, oligolectic bee species seemed to be filtered out in highly forested landscapes, probably because these species can thrive on the resources provided by mass flowering crops such as oilseed rape (Carrié et al., 2017a,b). Landscape elements such as forest edges have a positive effect on the presence of wild bees (Bailey et al., 2014). This positive effect was partly explained by the fact that they provide a higher frequency of dendro-microhabitats that are favourable for wood-nesting bee species (Ouin et al., 2015). More generally, wild bees were more abundant and diversified in more heterogeneous landscapes, but this relationship depends on the landscape-wide intensity of practices (Carrié et al., 2017a,b). Forest edges and hedgerows facilitate specific plant-bee interactions, thereby contributing to the resilience of the plant-bee interaction network in heterogeneous landscapes (Rivers-Moore et al., 2020).