For the Coase theorem to apply, all of the following conditions must be satisfied except
A) The basic rights of the individuals must be clearly understood.
B) There must be no impediments to bargaining.
C) Only a few people can be involved.
D) Liability rules must be established and enforced.

Question

Quizplus · Accepted Answer

The Coase theorem does not require liability rules to be established and enforced; it focuses on the ability of parties to negotiate without transaction costs when property rights are clearly defined.

For the Coase Theorem to Apply, All of the Following