In Coase's case of the doctor and the confectioner,who or what caused the negative situation?
A)The doctor,for moving his office so close to the confectioner that vibrations become a problem.
B)The confectioner,for creating the noise pollution.
C)Zoning laws.
D)Poorly defined property rights.

Question

Quizplus · Accepted Answer

Coase's case highlights the problem of externalities, where one person's actions affect another without their consent. In this case, the negative situation arises because of poorly defined property rights, as neither the doctor nor the confectioner have a clear right to the use of the space. If property rights were well-defined, the parties could potentially negotiate a solution that benefits both parties, such as the doctor paying the confectioner to move or soundproofing the confectioner's shop.

In Coase's Case of the Doctor and the Confectioner,who or What