The economist that originated the idea that government can correct externalities through taxes and subsidization is:
A) John Nash.
B) Arthur Cecil Pigou.
C) Ronald Coase.
D) Theodore Groves.

Question

Quizplus · Accepted Answer

The economist that originated the idea that government can correct externalities through taxes and subsidization is Arthur Cecil Pigou. He proposed the concept of a Pigouvian tax, which is a tax on a good or service that generates negative externalities, such as pollution, with the purpose of promoting more socially responsible behavior.

The Economist That Originated the Idea That Government Can Correct