The _____ states that it is usually more efficient to use the government policy tool that acts as directly as possible on the source of the distortion separating private and social benefits or costs.
A)Pigou effect
B)spillover effect
C)sudden-damage effect
D)specificity rule

Question

Quizplus · Accepted Answer

The specificity rule states that it is usually more efficient to use the government policy tool that acts as directly as possible on the source of the distortion separating private and social benefits or costs. This means that policies should be targeted to address the specific market failure or externality, rather than using broad policies that may have unintended consequences or be less effective.

The _____ States That It Is Usually More Efficient to Use