Unit 2: Negative externalities associated with global warming

Scientists in Brazil say global warming is responsible for the destruction of a small coastal town according to this BBC clip.

< http://www.bbc.co.uk/mediaselector/check/player/nol/newsid_7110000/newsid_7114300?redirect=7114312.stm&news=1&bbram=1&bbwm=1&nbwm=1&nbram=1&asb=1 >

a) Why is the villager's suffering an example of the market failing due tonegative externalities?