Indu Dhiman posted an Question
June 04, 2021 • 00:21 am 30 points
  • UGC NET
  • Economics

Question: 23/50 unit solved papers (1-10) - economics externalities exist due to market failure. what is the source of market failure that causes externalities?

Question: 23/50 Unit Solved Papers (1-10) - Economics Externalities exist due to market failure. What is the source of market failure that causes externalities? Free rider exists Involvement of third parties Property rights are poorly defined Failure of govt. intervention View Solution Property rights are poorly defined

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  • Ravindra nath mahto best-answer

    As we know that externalities are basically the external effects to the third party. These externalities arise because where to consume or to produce and where not to consume or not to produce, are not well - defined. Once if these are properly defined, the externalities cannot exist. That's why, technically we say that externalities arise because proper rights are poorly defined.

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