A lawsuit seeking compensation for damage from pollution
A) will ruin any chances the Coase theorem has of working to avoid the situation in the first place.
B) is a substitute for bargaining, but an inefficient one.
C) is a substitute for bargaining, and it can lead to the efficient solution.
D) is preferable to switching the property rights between the parties.
E) is how the Coase theorem was meant to work in the first place.
C
You might also like to view...
A firm experiencing economic losses could be earning accounting profits: a. If implicit costs are greater than zero. b. If implicit costs are equal to zero
c. If implicit costs are less than zero. d. In none of the above scenarios.
The degree of income inequality can be expressed with a:
a. Laffer curve b. Lorenz curve c. Lector curve d. Phillips curve
Grown children fawning over an elderly parent in order to try to secure a larger inheritance is an example of
A) rent seeking. B) logrolling. C) rational ignorance. D) public choice.
Developing countries do:
A. compete with one another for foreign investment, and this competition reduces the benefits from foreign investment. B. not compete with one another for foreign investment, because they have sufficient domestic saving to finance their investment needs. C. not compete with one another for foreign investment, because they lack the infrastructure to attract it in the first place. D. compete with one another for foreign investment, but this competition is beneficial to developing countries because it insures a more efficient allocation of resources.