A.C.Pigou argued that the government can deal with a positive externality in consumption by giving consumers a subsidy equal to the value of the externality.

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A.C. Pigou suggested that the government can address positive externalities in consumption by offering subsidies that are equal to the value of the externality. This is done to shift the marginal social cost curve downwards to achieve social efficiency.

ACPigou Argued That the Government Can Deal with a Positive