Which of the following describes the idea that private negotiations between people will lead to an efficient resolution of externalities, regardless of who has the property rights, as long as the property rights are defined?

Question

Quizplus · Accepted Answer

The Coase theorem states that private negotiations between people will lead to an efficient resolution of externalities, regardless of who has the property rights, as long as the property rights are defined. This means that as long as people can freely negotiate and are not prevented from doing so by transaction costs or other factors, the outcome will be efficient no matter who owns the property.

Which of the Following Describes the Idea That Private Negotiations