Next question The Coase theorem is the proposition that if property rights exist and are enforced, private transactions are O A. inefficient. O B. inequitable. C. illegal. O D. unnecessary. DE. efficient.
Ronald Coase developed the Coase Theorem, a legal and economic theory on property rights. It argues that in perfect competitive marketplaces with no transaction costs and an efficient set of inputs and outputs, the best decision will be made.
It basically argues that, regardless of the outcome, talking about property rights between individuals or organizations will result in the most effective and efficient solution.
-
The Coase Theorem asserts that, given the correct circumstances, parties to a property rights dispute will be able to reach an economically optimal settlement, regardless of how the property rights were distributed initially.
-
The Coase Theorem can help you think about how to settle disputes between competing firms or other economic uses of limited resources.
Trending now
This is a popular solution!
Step by step
Solved in 2 steps
