Question
In a Coasian sense, indicate in the figure below the following: a.What is the level of pollution under no liability (label as Q NL ).
In a "Coasian" sense, indicate in the figure below the following:
a.What is the level of pollution under "no liability" (label as QNL).
b.What is the level of pollution under "full liability" (label as QFL).
c.Which property rights starting point (QNL or QFL) will achieve efficiency with bargaining if there are no transaction costs?
d.Which property rights starting point could be seen as preferable if bargaining is impossible (due to high transaction costs)? Why?
e.Is one of these property rights arrangements (no liability or full liability) "Pareto superior" or a "Pareto improvement" compared to the other?
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Inquiry into Physics
Authors: Vern J. Ostdiek, Donald J. Bord
8th edition
1305959426, 9781337515863 , 978-1305959422
