One reason why property rights help achieve an efficient level of pollution is because property rights
A) force the marginal private cost to equal the marginal social cost.
B) force the marginal social cost to zero.
C) force the marginal external cost to a lower level than marginal private cost.
D) eliminate marginal private costs.
E) change the marginal external cost so that they are equal to the marginal social benefit.

Question

Quizplus · Accepted Answer

Property rights give individuals the right to use their property or resources as they see fit, subject to government regulations. With regards to pollution, property rights enable individuals to internalize the external costs they impose on others by polluting. This means that individuals must take into account the full costs of their actions, including the costs they impose on others, and adjust their behavior accordingly. By doing so, property rights incentivize individuals to reduce their pollution to a level where the marginal private cost (the cost of their own actions) equals the marginal social cost (the costs imposed on others), achieving an efficient level of pollution.

One Reason Why Property Rights Help Achieve an Efficient Level