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externality

American  
[ek-ster-nal-i-tee] / ˌɛk stərˈnæl ɪ ti /

noun

  • externalities
    plural
  1. the state or quality of being external to or outside someone or something; the fact of being outer, outward, or on the surface.

    A child just learning to speak already has a sense of the externality of the world.

  2. something external; an outward feature, or all outward features considered together.

    One can be too preoccupied with the externalities of religion.

  3. excessive attention to external or outward features; superficiality.

    The article explores the externality of identity in a world of media-constructed self-image.

  4. a side effect of some process or activity, especially a negative effect of an economic activity that is not accounted for in the price of what is produced.

    Externalities such as air pollution are sometimes eliminated through government regulation.

    They argue that there is an externality from breeding new pets, as the cute babies crowd out older pets.


externality British  
/ ˌɛkstɜːˈnælɪtɪ /

noun

  1. the state or condition of being external

  2. something external

  3. philosophy the quality of existing independently of a perceiving mind

  4. an economic effect that results from an economic choice but is not reflected in market prices

"Collins English Dictionary — Complete & Unabridged" 2012 Digital Edition © William Collins Sons & Co. Ltd. 1979, 1986 © HarperCollins Publishers 1998, 2000, 2003, 2005, 2006, 2007, 2009, 2012

Other Word Forms

Derived Forms

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Nouns

Etymology

Origin of externality

First recorded in 1665–75; external + -ity

Explanation

An externality is an outside factor or condition that can affect something else. A snow storm for example, is an externality that can cause delays at the airport. Externality comes from the Latin root word externus meaning "outside" or "outward." An externality is something on the outside that affects other things. Often an externality is a behavior or result of behavior by one party that affects others who have no choice in its happening. For example, factory pollution is an externality that can affect people's health and well-being. It's outside of their control and yet it has an impact on their lives.

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Example Sentences

Examples are provided to illustrate real-world usage of words in context. Any opinions expressed do not reflect the views of Dictionary.com.

See Examples For:

Most people think of money as a macro phenomenon or externality.

From MarketWatch May 12, 2026

"In economics, we call that externality," she said.

From Science Daily May 22, 2024

In the language of economics, the decision imposes an externality on the nation, which is exactly the kind of decision that states alone should not be making for other states.

From Slate Dec. 20, 2023

In short, electric vehicle production just doesn’t look like a network externality business.

From Seattle Times Dec. 28, 2022

The image, which in the mine of intelligence was only its property, now that it has been endued with externality, comes actually into its possession.

From Hegel's Philosophy of Mind by Georg Wilhelm Friedrich Hegel

How do you think about the potential externalities of AI, such as unemployment?

From Barron's Apr. 7, 2026

Preparation for these varying externalities requires supply-chain middlemen and product sellers to anticipate consequential cost increases down the line—and implement them sooner than later, in order to cover their margins.

From Slate Jun. 17, 2024

In traditional economics-speak, hidden costs are known as externalities – spillover effects from production that are caused by one party but paid for by another.

From Salon Feb. 28, 2024

Analysts think environmental externalities may come under greater scrutiny for waste-to-energy projects selling offsets as the global carbon market evolves beyond the Clean Development Mechanism to a new U.N.-run program.

From Seattle Times Dec. 5, 2023

In this eclectic manner he accommodated himself in a few externalities to the different religious communities existing in his kingdom.

From Akbar, Emperor of India by Richard von Garbe

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