In my Executive MBA economics class a little over a week ago, I presented the following definition of a negative externality: A cost borne by someone who is not party to the decision that caused the cost.

CalPERS also said it had made $24.2 billion in profit from private-equity firms over the same period, according to its new data-collecting program, called Private Equity Accounting and Reporting.

Economist Noah Smith has a recent article titled "Most of What You Learned in Econ 101 Is Wrong." He doesn't actually make the case that would support that title. But he also probably didn't choose the title.