Regardless of who has the property rights to environmental resources

Question

Quizplus · Accepted Answer

Net gains to society differ depending upon who holds the property rights to pollute because the allocation of resources will be different depending on who has the right to pollute. If the polluter has the right to pollute, then they will produce more pollution than if they did not have the right to pollute. This is because they do not have to bear the costs of the pollution, so they will not take into account the negative externalities that their pollution creates. On the other hand, if the victim of the pollution has the right to pollute, then they will produce less pollution than if they did not have the right to pollute. This is because they will have to bear the costs of the pollution, so they will take into account the negative externalities that their pollution creates.

Regardless of Who Has the Property Rights to Environmental Resources