Externalities, Environmental Policy, and Public Goods
5.1) Externalities and Economic Efficiency
Identify examples of positive and negative externalities and use graphs to show how externalities affect economic efficiency
5.2) Private Solutions to Externalities: The Coase Theorem
Discuss the Coase theorem and explain how private bargaining can lead to economic efficiency in a market with an externality.
5.3) Government Policies to Deal with Externalities,
Analyze government policies to achieve economic efficiency in a market with an externality.
5.4) Four Categories of GOods,
Explain how goods can be categorized on the basis of whether they are rival or excludable and use graphs to illustrate the efficient quantities of public goods and common resources.