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Transportation is a classic externality. The costs of building infrastructure are direct, while the benefits diffuse. You tend only to see that sort of behavior
by c3534l 11y ago
Transportation is a classic externality. The costs of building infrastructure are direct, while the benefits diffuse. You tend only to see that sort of behavior by monopolies, like the examples you mentioned applying to companies that own very large swaths of land. You can sometimes see this behavior in R&D, too. Bell spent a lot of money on research and development because they knew as the only major telephone company they would be the only ones to benefit.