If conditions are just right, private solutions to externalities can occur. This means the government doesn't have to put its sticky fingers in our market!

Concept #1: The Coase Theorem

Practice: A key element of the Coase theorem is:

Practice: Which of the following is not a way of dealing with externalities?

Practice: If the assumptions of the Coase theorem are satisfied, th

Practice: It is possible to remedy a positive externality by:

Practice: The socially optimal level of pollution: