ABSTRACT
Economists have tried for a long time to shape the mode of thinking about damages that arise from economic activity. As ‘social costs’ or ‘externalities’ these damages were assigned a specific place in modern society. According to historians of economic thought: ‘It is now well established that the boundaries of the modern analysis of externalities were defined by A.C. Pigou's Economics of Welfare ([1920] 1932) and Ronald H. Coase's “Problem of Social Cost” (1960)’ (Aslanbeigui and Medema 1998: 1).
