For each of the following situations, is the Coase Theorem applicable? Why or why not? a. A

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For each of the following situations, is the Coase Theorem applicable? Why or why not?

a. A farmer who grows organic com is at risk of having his crop contaminated by genetically modified com grown by his neighbors.

b. In Brazil it is illegal to catch and sell certain tropical fish. Nevertheless, in some remote parts of the Amazon River, hundreds of divers come to capture exotic fish for sale on the international black market. The presence of so many divers is depleting the stock of exotic fish.

c. In the state of Washington, many farmers bum their fields to clear the wheat stubble and prepare for the next planting season. Nearby city-dwellers complain about the pollution.

d. Users of the Intemet generally incur a zero incremental cost for transmitting information. As a consequence, congestion occurs, and users are frustrated by delays.

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Public Finance

ISBN: 9780073511283

8th Edition

Authors: Harvey Rosen, Ted Gayer

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