Y1 36 Property rights and market failure

Question 1

Property rights used to combat market failure

Answer 1

Incentive to not exploit common access resource, externality internalised

Question 2

Property rights to solve market failure

Answer 2

Incentive to not exploit common access resources, externality internalised, only exploiting producer suffers

Question 3

Property rights Cons

Answer 3

Efficient distribution: Air and sea cant be distributed efficiently
Cost: Enforcement cost high, mass tresspassing without enforcement
Equity: Common people cannot afford property rights