Coase suggested that a good solution to an externality is:

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Coase suggested that bargaining between affected parties is the best solution to an externality because it can lead to an efficient outcome without the need for government intervention. In his theory of the Coase Theorem, he argued that if property rights are well-defined and transaction costs are low, affected parties can negotiate and come to an agreement that maximizes the overall social welfare. This way, the solution is tailored to the specific situation and preferences of the parties involved, rather than a one-size-fits-all government regulation or Pigouvian tax. The privatization of publicly owned resources is not necessarily related to solving an externality and may lead to other issues such as monopolies or lack of access for certain groups.

Coase Suggested That a Good Solution to an Externality Is