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Piouvian Taxes - Tesco chicken supplier and pollution in the River Wye

5th February 2023

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A very localised example here of a negative production externality, with algal blooms on the River Wye being attributed to the activities of poultry producer, Avara Foods.

As a result, campaigners are arguing that the company should be held responsible for the costs of cleaning up the river, internalising the externality. It is the optimal Pigouvian solution.

I've no doubt though that Avara will argue that others also contribute to the marine pollution and thus calculating the extent to which individual firms, and farmers, would need to contribute would be difficult.

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Graham Watson

Graham Watson has taught Economics for over twenty years. He contributes to tutor2u, reads voraciously and is interested in all aspects of Teaching and Learning.

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Piouvian Taxes - Tesco chicken supplier and pollution in the River Wye

Graham Watson

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Piouvian Taxes - Tesco chicken supplier and pollution in the River Wye

Graham Watson

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