Why are externalities associated with common property rather than private property?
What will be an ideal response?
When private property rights exist, individuals can take someone to court and collect damages when the actions of that person damage the individual's property. When the person has to pay damages, the externality is internalized. With common property, no one can exclude anyone else and there is no legal recourse for collecting damages from the person.
Economics
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Refer to the figure above. If A forms a customs union with B, the value of trade diversion will be
A) $0. B) $10,000. C) $20,000. D) $40,000.
Economics
Output per worker tends to be higher in countries with
a. low-quality infrastructures b. high-quality infrastructures c. perfectly competitive labor markets d. low taxes e. free riders
Economics