The technical treatment of externalities does account for that, but it also blows up the standard implementation model for dealing with externalities.

Undisciplined

McCloskey quote from the (summary) reading today:

Externalities are not simply technological—though without much reflection most economists firmly believe they are. 

Externalities are defined socially all the way down

. If factory smoke became fashionable to breathe, it would stop being a negative externality and would become a positive one.”

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The State is Entrepreneurial: It Matches Nature with Entrepreneurs!

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McCloskey quote from the (summary) reading today: 

> Externalities are not simply technological—though without much reflection most economists firmly believe they are. **Externalities are defined socially all the way down**. If factory smoke became fashionable to breathe, it would stop being a negative externality and would become a positive one.”

...and: 

![](https://m.stacker.news/160703)