What does the Coase Theorem predict?
What will be an ideal response?
The Coase Theorem predicts that if the production or consumption of a good involves a negative externality, bargaining between the party creating the externality and the party suffering from it will result in an efficient allocation of resources irrespective of who holds the legal property rights if transaction costs are not too high.
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Tuition is the single-largest cost of attending college for most students
a. True b. False Indicate whether the statement is true or false
An example of a government policy to increase human capital formation is:
A. government support for basic research. B. the provision of publicly-funded education. C. the construction of an interstate highway system. D. maintaining a well-functioning legal system.