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Classic smog results from the burning of coal and is caused by a mixture of smoke and sulphur dioxide. Photochemical smog is caused by emissions of hydrocarbons and nitrous oxides from vehicle exhausts. Named for its similarity to a cross between smoke and fog, smog is damaging to health. The Great Smog of 1952 in London was directly responsible for approximately 4000 deaths, and possibly several thousand more from the damage to health it caused. Smog occurs particularly in heavily urbanized areas subject to temperature inversion which traps emission products near the surface. Smog is an obvious and conspicuous example of a negative externality.

Reference: Oxford Press Dictonary of Economics, 5th edt.