The Economic Way of Thinking 13th Edition by David Prychitko, Peter Boettke, Paul Heyne

Exercise 1

Officials in River Edge, New Jersey, passed an ordinance making it illegal for residents to park vehicles with commercial license plates or with signs on the doors in their driveways overnight.
(a) Were the parkers generating negative externalities?
(b) Why did those who disliked seeing such vehicles in their neighbourhood choose to push for a new ordinance rather than talk directly to the owners of the vehicles?
(c) The ordinance made some people better off and some worse off. How can we know whether the benefits of the ordinance exceeded its costs?