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7. Private solutions to correct for externalities Consider the following scenario: Suppose that a
chicken farm uses a nearby stream to dispose of the wastes released by its chickens. These
wastes flow downstream into a lake that has become thick with algae and polluted by the
minerals in the waste matter. The local office of a nonprofit environmental organization collects
enough donations to fund a campaign to stop the farm's pollution. Which of the following private
solutions resolving the externality of pollution took place in this scenario? Integration of
different types of businesses through merger or acquisition Moral codes and social sanctions
Charities Contracts

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7- Private solutions to correct for externalities Consider the followi.pdf

  • 1. 7. Private solutions to correct for externalities Consider the following scenario: Suppose that a chicken farm uses a nearby stream to dispose of the wastes released by its chickens. These wastes flow downstream into a lake that has become thick with algae and polluted by the minerals in the waste matter. The local office of a nonprofit environmental organization collects enough donations to fund a campaign to stop the farm's pollution. Which of the following private solutions resolving the externality of pollution took place in this scenario? Integration of different types of businesses through merger or acquisition Moral codes and social sanctions Charities Contracts