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Negative Externalities and the Coase Theorem

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What are negative and positive externalities? How does it relate to the Coase Theorem? Learn more: http://bit.ly/1HVAtKPIn economic activity, there are sometimes 'externalities' or spillover effects to other people not involved in the original exchange. Positive externalities result in beneficial outcomes for others, but negative externalities impose costs on others. Prof. Sean Mullholland addresses a classic example of a negative externality, pollution, and describes three possible solutions for the problem: taxation, government regulation, and property rights. The first two options are difficult to monitor and may create perverse incentives. A better solution to overcome the externality is property rights, as described by Ronald Coase. As long as property rights are well-defined, divisible, and defendable, parties can negotiate to reduce the impact of the pollution.SUBSCRIBE: http://bit.ly/1HVAtKPFOLLOW US:- Website: https://www.learnliberty.org/- Facebook: https://www.facebook.com/LearnLiberty- Twitter: https://twitter.com/LearnLiberty- Google +: http://bit.ly/1hi66ZzLEARN MORE:Watch more videos like this: http://lrnlbty.co/y5tTcYLEARN LIBERTYYour resource for exploring the ideas of a free society. We tackle big questions about what makes a society free or prosperous and how we can improve the world we live in. Watch more at http://bit.ly/1UleLbP


economics regulation world economy externality economy political science theory ronald coase libertarian learn liberty economic libertarianism us economy what is a libertarian coase theorem social development libertarianism explained
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