Negative externalities and the tragedy of the commons are problems that have a common source.What is this common source?
A)self-interest motives of producers and consumers
B)a lack of concern for human rights
C)a lack of competition
D)a lack of clearly defined and enforced property rights

Question

Quizplus · Accepted Answer

The common source of negative externalities and the tragedy of the commons is a lack of clearly defined and enforced property rights. In the case of negative externalities, producers or consumers are not held accountable for the harm they cause to others, as property rights are not properly defined, leading to a market failure. Similarly, in the case of the tragedy of the commons, when no one owns a common resource, it tends to be overused, degraded, or depleted because individuals lack incentives to conserve it or invest in its upkeep. Establishing clearly defined and enforced property rights helps solve these problems by providing incentives for individuals to internalize the costs and benefits of their actions.

Negative Externalities and the Tragedy of the Commons Are Problems