Negative externalities in consumption, such as homeowners planting trees, only impose costs on neighbors without any potential benefits to the community.

Negative externalities in consumption happen when someone's actions have harmful effects on others who are not involved in that decision. For example, if a homeowner plants a large number of trees, they might block sunlight from reaching their neighbors' yards. While the homeowner might enjoy the shade and beauty of the trees, the neighbors could suffer from less sunlight, potentially harming their gardens or making their homes feel darker. This situation shows how one person's choice can create costs for others without providing any benefits to the wider community. Understanding these externalities can help us find better solutions that consider everyone's needs.