The Coase theorem does NOT apply if a. There is a significant externality between two parties. b. The court system vigorously enforces all contracts. c. transaction costs make negotiating difficult. d.both parties understand the externality fully.
The Coase theorem does NOT apply if a. There is a significant externality between two parties. b. The court system vigorously enforces all contracts. c. transaction costs make negotiating difficult. d.both parties understand the externality fully.
Principles of Microeconomics (MindTap Course List)
8th Edition
ISBN:9781305971493
Author:N. Gregory Mankiw
Publisher:N. Gregory Mankiw
Chapter10: Externalities
Section: Chapter Questions
Problem 6CQQ
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The Coase theorem does NOT apply if
a. There is a significant externality between two parties.
b. The court system vigorously enforces all contracts.
c. transaction costs make negotiating difficult.
d.both parties understand the externality fully.
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