The iPhone 4s - a demerit good?

The release of the iphone 5 has resulted in an abundance of amusing comments and pictures on the web but the following is probably my favourite, naturally because it allows me to discuss an important economic concept, demerit goods.

Who would have thought that the iphone4S was a demerit good, causing significant health issues? The good news is that version number 5 solves these problems and can allow Apple addicted consumers the chance to start healing, although for some the damage is probably already done.

The Onion (which occasionally gets quoted as real news) reports that the iphone 5’s lighter weight is saving consumers from the problems of the crushingly heavy 4S with hunchbacks and shoulder dislocation when picking it up being common problems. These health problems could also generate negative externalities, particularly in countries with publically funded health systems.

This can lead into a slightly different discussion – do mobile phones have negative AND positive externalities? What are some of them? Are any of them significant enough to warrant government intervention?