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fect parties external to the economic transactions that cause them.
Externalities escape the control of the market mechanism because
no  fi nancial incentive motivates polluters to minimize the damage
they do.” 4
You would fi nd a similar defi nition in other economics textbooks.
So the use of the concept of externalities—and its utility in under-
standing the market failures of pollution—is an example of the scien-
tifi c consensus in economics. Economists might and indeed do disagree
about which externalities are important, about the best policies to cor-
rect externalities, and about how much to tighten the screws on exter-
nalities like toxic wastes or global warming. But mainstream economists
do not claim that externalities are a hoax. Similarly, mainstream scien-
tists do not claim that climate change is a hoax.
Suppose that we would like to fi nd the collective judgment on a
specifi c scientifi c question. How is that done in practice? In many areas
of science, consensus is determined by the reports of expert groups.
Take as a leading example the U.S. National Academies, which is the
premier American scientifi c institution. That body has a carefully de-
signed process for producing consensus reports. In writing reports, the
National Academies insist on several ingredients: independence from
external pressure, expertise, reliance on evidence, objectivity, approval
by the Academies' leadership, and disclosure of confl icts of interest. 5
For example, Congress was concerned about the use of evidence in
criminal trials. In recent years, DNA evidence has shown that many
people were sentenced to death based on faulty eyewitness testimony.
The Congress asked the National Academies to prepare a report to “make
recommendations for maximizing the use of forensic technologies and
techniques to solve crimes, investigate deaths, and protect the public.”
The Academies then convened a panel of experts to study and re-
port on the subject. The panel reviewed the scientifi c literature, synthe-
sized existing knowledge, and wrote a report. The output was a consensus
of the panel members. It was peer reviewed by outside experts, and was
then approved by the governing board of the Academies. In this case,
you can read the report, Strengthening Forensic Science in the United States:
A Path Forward, to see what the experts recommend. 6
 
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