<externalities>

externalities, as understood in the field of economics, are defined as the cost or benefit of a market activity bore by a third party, or the difference between the social and private cost or benefit of a market activity.

negative externalities are actions that impose costs on others without paying appropriate compensation -- for instance, a steel firm dumping pollution into a river which hurts a fishery downstream, cigarette smokers in public places, students who walk into class late or let their cell phones ring, or the "the club" anti-theft device.

positive externalities on the other hand are actions that impose benefits on others without receiving appropriate compensation -- for instance, research and development by one firm which benefits another firm, a smart student who asks good clarifying questions during class, the "lojack" anti-theft device.

<a simple idea>

this project explores how externalities can be represented through the variability of the price of a product.
where in some cases the action of purchasing goods can provide us with additional information about underlying conditions (i.e. change in price of gas), most day to day interactions of this kind go unaffected by this bits of available information.

By slightly modifying the structure of the interaction, we are able to convey these externalities that underlie a given economic exchange. A change in price is usually understood as representing a fluctuation in the supply-demand relation. In the case of sodas, several day-to-day models can be thought of: sodas are more expensive on hot days; sodas are more expensive in situations where small-scale monopolies exist (stadiums, concerts, bars, etc). In these situations, the price can be a simple information carrier.

In one case, price carries local temperature information, which can be considered as part of the externalities of the exchange.
The case of gas is more complex, as it represents not only supply demand information, but also a variety of information bits (which we usually know about and are ready to process) about the political or economic situation concerning this specific market.

We propose several models that expose these externalities: -stock price fluctuation -contract incompleteness.
The goal behind this experiment is to have users "explore" the underlying mechanism when an unexpected price change occurs.