Catastrophic externality is loss of control seen through the framework’s ecological-transfer lens: a frontier effort can generate enormous local economic and strategic benefit while imposing a small probability of extraordinary, irreversible global harm — the upside captured locally, the downside spread across everyone and every generation. It is the sharpest possible case of the accounting-boundary problem, and it drives the framework’s strongest claim about who may decide: because jurisdiction must rise to the scale of the externality, and the externality here is civilization-wide, no local participant — firm, government, military, or lab — holds sufficient jurisdiction to authorize running the risk alone.
The accounting rule it enforces is that catastrophic exposure belongs on the ledger even when it cannot be priced. Traditional accounting drops the tail because the tail is hard to quantify; ecological accounting refuses to, on the principle that a cost does not become zero simply because it is difficult to price. Making the exposure visible is the first step toward sizing the jurisdiction to match it.