The upper limit, perhaps n does not approach infinity
Well, according to this geologist, your high-tech, earthquake resistant skyscraper, may cause my low-tech 1950's apartment building to tumble to the ground. If this is proven to be the case, shall we call on government to enact regulation to nullify this negative eternality?
First glance tells me yes, we should. Building a new tall tall building is different from introducing a new technology. Whereas the new technology may throw some people out of work, it does so by increasing the efficiency of the production process. In a competitive market, this efficiency is passed along to the consumers in the form of lower prices and better selection of products. In the short run, what for a few workers feels like a negative eternality, is more often than not outweight by the positive benefits. However, with the skyscrapers, if they do cause earthquakes, the negative external effects would probably outweigh the benefits, right? Potentially causing billions of dollars in damage and taking lives...
Second glance is not so sure. It really all depends on the increase in the probabilty of earthquake caused by the skyscrapers. The problem is, even if the increase is really small, if an earthquake occurs, blame will likely be placed on the skyscrapers. However, if the increase is sufficiently small, then regulating the size of skyscrapers could cause more harm than good.
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