How did Coase view the role of government in dealing with externalities?
Central Role
Minimal Role
Unnecessary
Regulatory
Answer
Minimal government intervention was Coase's preferred approach to externalities. He argued that when property rights are clearly defined and transaction costs are low, private negotiations between the affected parties can efficiently resolve externalities without government involvement. This approach emphasizes the efficiency of markets in allocating resources and resolving conflicts, and it assumes that voluntary agreements can achieve a Pareto-optimal outcome.
Coase's Economic Conundrums: Unraveling the Legacy of a Nobel Laureate
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When Ronald Coase died?
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