The result that, under certain circumstances, no government action is needed to control an externality because it can be eliminated by bargaining between the affected parties is called

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The Coase Theorem states that if property rights are well-defined, and transactions costs are low, then private bargaining will result in an efficient allocation of resources, regardless of initial entitlements. This means that parties will voluntarily negotiate amongst themselves to solve an externality issue, without the need of government intervention.

The Result That, Under Certain Circumstances, No Government Action Is