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Re: [xml-dev] What are the "externalities" of deploying a web service?

The users of the internet pay by paying their local IP for internet services 
(who then pay for upband services),
or by paying in taxes if its a government funded internet. Or both.
The Web services also pay *their* internet provider and/or taxes.

Your examples from the book seem incomplete.   Atleast in a capitalistic 
based society:
The car owners pay taxes (gas taxes, road, sales/VAT and general taxes) 
which contribute to the externalities.
The educated person gets a check *later* when they actually show benefit for 
society by getting a job and expending their stored value (education).  Or 
they can choose not to use it, and have absorbed societies 'donation' 
because often education costs more then individuals pay (subsidized by 
government aka taxes) in which case they have taken but not given.

The web site owner may or may not get paid for providing 'value' to society 
depending on their business model.
Although often any income is derived by providing things the end-customer 
doesn't really want
but rather by something someone else wants you to have and is willing to pay 
for it  (advertising),

Of course the internet is not unique.   You could build a public library or 
hospital if you wanted, which provided value to society, and depending on 
your business model you may or may not get any income from this.

Somehow it all works out in the end or we'd end up with massive inflation.
But the details are not always considered 'fair' by every individual  for so 
many reasons beyond the scope of this email.

David A. Lee

From: "Costello, Roger L." <costello@mitre.org>
Sent: Saturday, January 16, 2010 7:40 AM
To: <xml-dev@lists.xml.org>
Subject: [xml-dev] What are the "externalities" of deploying a web service?

> Hi Folks,
> Consider these two examples:
> 1. When you drive, you pay for only gasoline and maintenance. You don't 
> pay for the noise and pollutants that your car emits.  You also don't pay 
> for the added congestion and delays that you impose on other drivers.
> 2. When society is educated, it costs less to produce signs, ballots, tax 
> forms, and other information tools. Literacy enables a democracy to 
> function effectively, and higher education may stimulate scientific 
> discoveries that improve the welfare of society. When you acquire an 
> education, however, you do not get a check in the amount of savings your 
> education will create for society.
> The first example shows costs that you incur but are borne by others not 
> directly involved.
> The second example shows benefits that you incur but are accrued by others 
> not directly involved.
> Externalities are the costs or benefits of a market activity borne or 
> accrued by someone who is not a direct party to the market transaction.
> What are the externalities of deploying a web service?
> Here's one: Suppose you deploy a web site and it is massively successful - 
> lots of people visit your web site. You assume the costs of hiring land, 
> labor, and capitol. But you don't bear the costs associated with the 
> increased congestion and delays you impose on other users of the Internet.
> Increased congestion and delays are externalities of deploying a web 
> service. What are the other externalities?
> Who pays for the externalities? For instance, who pays for the additional 
> routers and DNS servers?
> /Roger
> P.S. The two examples and the definition of "externalities" come from the 
> book: "Economics" by Boyes and Melvin.
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