The creation of private property rights corrects negative externality problems in many cases because they
A) cannot create negative externalities
B) create a strong incentive for the private owners to maintain the property
C) can force the government to compensate the owners for the externality costs
D) encourage people to become free riders
E) always lead to the social optimal price and output levels

Question

Quizplus · Accepted Answer

Private property rights incentivize owners to maintain and improve their property, thereby often mitigating negative externalality issues by encouraging responsible ownership and use of resources.

The Creation of Private Property Rights Corrects Negative Externality Problems