229k views
4 votes
How can the government increase the production of goods/services that have positive externalities?

User Unobf
by
8.2k points

1 Answer

3 votes

Final answer:

The government can increase the production of goods/services with positive externalities by providing subsidies or tax incentives, investing in research and development, and implementing regulations or standards.

Step-by-step explanation:

In order to increase the production of goods/services that have positive externalities, the government can use several strategies:

  1. Provide subsidies or tax incentives to producers of goods/services with positive externalities. This can lower their costs and encourage them to produce more.
  2. Invest in research and development to improve the technology and efficiency of producing goods/services with positive externalities. This can make it easier and more profitable for producers to increase their production.
  3. Implement regulations or standards that require or encourage the production of goods/services with positive externalities. This can create a level playing field and ensure that the production of these goods/services is prioritized.

User Olena
by
7.8k points