Economics Externalities Questions
Private benefits refer to the individual benefits or gains that a person or entity receives from a particular economic activity or decision. These benefits are exclusive to the individual or entity involved and are often measured in terms of monetary value.
On the other hand, social benefits encompass the overall benefits or gains that society as a whole receives from a particular economic activity or decision. These benefits extend beyond the individual or entity involved and include positive externalities that affect others in society. Social benefits take into account not only the private benefits but also the external benefits that spill over to third parties.
In summary, the difference between private and social benefits lies in the scope of beneficiaries. Private benefits are limited to the individual or entity directly involved, while social benefits consider the broader impact on society as a whole.