The concept of externalities is a crucial aspect of economics and social sciences. Externalities refer to the spillover effects of an economic activity on third parties who are not involved in the activity. These effects can be either positive or negative and may occur in various ways, such as pollution, congestion, noise, and other environmental or social impacts. In many cases, externalities are overlooked or not considered in the decision-making process, leading to a distortion of market outcomes and a suboptimal allocation of resources.

A $40 shirt is probably $240 when you include environmental costs and externalities

While it is true that the true cost of a product, such as a shirt, may exceed its market price due to the inclusion of environmental costs and externalities, it is difficult to provide a definitive figure without further information and analysis.

The environmental costs of producing a shirt may include the energy and resources required to extract and process the raw materials, the emissions and waste generated during production, and the impacts of transportation and distribution. These costs are often not reflected in the market price of the product, and are instead borne by society and the environment.

Similarly, externalities such as the social and health impacts of the production process, such as the working conditions of laborers and the impact of chemicals used in the production process, may also not be factored into the market price of the shirt.

One example of a game that involves obfuscating externalities is the classic game of Monopoly. In Monopoly, players compete to acquire properties and collect rent from other players. However, the game does not account for the externalities of property ownership, such as the impact of high rents on local communities or the displacement of low-income residents. In this way, Monopoly can be seen as promoting a narrow and incomplete view of the economic system, one that fails to account for the broader social and environmental impacts of economic activity.

Another example of a game that involves smuggling externalities is the game of resource extraction. In this game, players compete to extract resources such as oil, gas, or minerals from a common pool. However, the game does not account for the negative externalities of resource extraction, such as environmental degradation, social conflict, and economic inequality. By ignoring these externalities, the game encourages players to pursue a strategy of short-term gain at the expense of long-term sustainability and social welfare.

In both of these examples, the nature of the game is obfuscating and smuggling externalities. The games create a false sense of reality, one that ignores the real-world impacts of economic activity and encourages players to pursue strategies that may harm others. This is not to say that games are inherently bad or that they cannot be used to promote social welfare. However, it is important to recognize the limitations of games and to design them in a way that takes externalities into account.

To address the issue of obfuscating and smuggling externalities in games, there are several possible approaches. One approach is to incorporate externalities into the game design explicitly. For example, a game could require players to pay a penalty for each unit of pollution they generate or each low-income resident they displace. This would force players to consider the broader social and environmental impacts of their actions and would incentivize them to pursue strategies that promote long-term sustainability and social welfare.