Which of the following is not a necessary condition for the Coase theorem?
A)Property rights are clearly defined.
B)The costs of bargaining are sufficiently low.
C)The government intervenes to internalize the externality.
D)There are only a few parties involved.

Question

Quizplus · Accepted Answer

The Coase theorem assumes that the government does not intervene to internalize the externality. Rather, private parties can negotiate and arrive at an efficient solution on their own if property rights are clearly defined and transaction costs are sufficiently low.

Which of the Following Is Not a Necessary Condition for the Coase