7 off without making someone else worse off. Externalities
7 Answer to Question 2 The Coase theorem, developed by economist Ronald Coase, posits that when property rights are clearly defined and trade is possible at low transaction costs, bargaining will lead to an efficient outcome regardless of the initial allocation of these rights (McDougall, 2017, Week 2). Though the theorem is said to provide attractive solutions on how the private market can effectively deal with various externality problems, specifically environmentally related problems, this proposition will discuss the contextual issues that can arise with Coasian remedies. Ultimately, this paper will stipulate that the Coase theorem, like any other economic or policy theory […]