Means of coping with negative externalities include all of the following except
A)implementing abatement technology.
B)patents.
C)property rights.
D)Pigovian taxes.
E)cap-and-trade.

Question

Quizplus · Accepted Answer

Patents do not directly address negative externalities. Patents provide a temporary monopoly to inventors in order to incentivize innovation and generate economic growth. While patents may indirectly encourage the development of abatement technology, property rights and Pigovian taxes are more direct means of mitigating negative externalities. Cap-and-trade also directly addresses negative externalities by setting a limit on the total amount of pollution allowed and creating a market for buying and selling pollution permits.

Means of Coping with Negative Externalities Include All of the Following