First stated in the work The Problem of Social Cost, for 10 points, name the theorem that states that, when trade in an externality is possible and there are no transaction costs, bargaining will lead to an efficient outcome regardless of the initial allocation of property rights.
In a paper describing the economy of professional beekeeping, James Meade argued that this statement could not possibly hold true for bargaining involving pollination. Judge Learend Hand applied a version of this statement to the case US v. Caroll Towing. The "invariance" version of this statement is sometimes negated by the wealth effects that change prices and distributions, while the (*) "efficiency" version of this theorem is designed to abate the need for Pigouvian taxes. First stated in the work The Problem of Social Cost, for 10 points, name the theorem that states that, when trade in an externality is possible and there are no transaction costs, bargaining will lead to an efficient outcome regardless of the initial allocation of property rights.
In a paper describing the economy of professional beekeeping, James Meade argued that this statement could not possibly hold true for bargaining involving pollination.
{Coase’s} Theorem