When it comes to pollution problems, the polluter and the victim can bargain to arrive at the outcome desired by the benevolent social planner.

Question

Quizplus · Accepted Answer

This statement is based on the Coase Theorem, which suggests that if property rights are well-defined and transaction costs are low, the allocation of resources will be efficient and invariant to the assignment of property rights, allowing the polluter and the victim to negotiate a mutually beneficial solution.

When It Comes to Pollution Problems, the Polluter and the Victim