Part 8/8:
The Coase theorem introduces a compelling framework for addressing externality issues through private solutions. By properly assigning property rights and ensuring that both conditions of enforceability and low transaction costs are met, societal conflicts surrounding externalities like pollution can be potentially resolved without relying solely on government intervention. Understanding and applying these principles can pave the way toward more sustainable development strategies that consider both economic and environmental needs.
As we move forward, exploring government solutions to externalities will broaden our understanding of regulatory frameworks in creating an efficient economic environment.