In theory, liability rules for pollution are designed to have the same effect as taxing a polluter.

Name: In theory, liability rules for pollution are designed to have the same effect as taxing a polluter.
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Liability rules for pollution, like taxes on pollution, aim to internalize the external costs of pollution, making polluters bear the costs of the damage they cause, thereby incentivizing them to reduce pollution to socially optimal levels.

In Theory, Liability Rules for Pollution Are Designed to Have