Social Cost

{
  "id": "MLC-T-ENV-025906",
  "term": "Social Cost",
  "field": "Environment",
  "definition": "1. The net loss considerations of long-range societal values at the regional or national level which might not be taken into account in the profit and loss statement of an individual farmer, forest operator, industrialist or other private citizen. (Wash. State Univ., Coop. Ext. Serv. 1972) Note that this term in economic usage does not include the profit and loss statements of such legally defined individuals as corporations. Their profits and losses are assumed to appear in the statements of single individuals. In common usage social cost is often used when referring to the externality costs accruing to groups of individuals or to society as a whole. (C.F.S.)]\n\n2. The sum of all opportunity costs, or reductions in societal well-being, incurred as a result of the regulation or policy action. These opportunity costs consist of the value lost to society of all the goods and services that will not be produced and consumed as regulated entities reallocate resources in order to comply with the regulation. To be complete, an estimate of social cost should include both the opportunity costs of current consumption that will be foregone because of the regulation, and also the losses that may result if the regulation reduces capital investment and thus future consumption.",
  "subject": "General environmental",
  "references": [
    "USDA Forest Service Wildland Planning Glossary",
    "Economic Analyses Glossary; Preparing Economic Analyses Glossary"
  ],
  "url": "https://mlchart.com/terminology/environment/social-cost/"
}