In the early hours of Tuesday morning in this part of the world the famous Melbourne Cup went to post at Flemington Racecourse in Australia. There was not much hype about the race this year over here (there normally is) largely because there was little European interest, and no Irish runner. This despite Irish winners of the race as recently as 2020 and 2017.
The event lived up to its billing as "the race that stops a nation" and top weight Gold Trip won a thrilling renewal of the Melbourne Cup. And while those that owned and trained the horse probably celebrated into the evening and night, spare a thought for residents nearby.
While sport is often used as an example of a positive externality (and there are many examples of this), negative externalities are less often cited. But Flemington Racecourse provides us with one.
In 2006 course owners were granted permission to build a floodwall around the track to prevent the course from becoming flooded. The wall was completed the following year. The 2.5 meter wall protects the racing surface from the Maribyrnong River which flows right next to the course.
However, because the racecourse is a natural flood plain for the river, excess water now has to accumulate elsewhere. That "elsewhere" is somebodies home. The picture below demonstrates just how high this water can get.
In a world of ever-more dramatic climate events one can only assume this flooding will get worse. The external effects of building this wall, to protect a sport institution in Australia, have undoubtedly led to unintended consequences and a negative externality.