Chapter 7: Hockey Helmets, Daylight Saving, and Other Binary Choices Summary and Analysis

Binary choices with externalities—either/or situations are something with which everyone is confronted at one time or another. An "externality" enters into the fray when the thoughts or behavior of another person affects what another person chooses to do. For example, after a famous professional hockey player has a hockey stick driven through his skull to his brain, other players contemplate whether they should begin wearing helmets. The general feeling is that although the players know it is safer to wear helmets, their vanity will prevent them from doing so. The players feel that they risk being ridiculed for being weak or unmanly if they would begin wearing helmets. However, it is a general consensus that the players would all be glad if...