a. When transaction costs are low enough, efficient resource allocation will follow regardless of the particular assignment of property rights. When transaction costs are high enough, efficient resource allocation requires assigning property rights to the party who values them the most. Give an example of each case.

ENGR.ECONOMIC ANALYSIS
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Chapter1: Making Economics Decisions
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QUESTION 4.11:
a. When transaction costs are low enough, efficient resource allocation will
follow regardless of the particular assignment of property rights. When
transaction costs are high enough, efficient resource allocation requires
assigning property rights to the party who values them the most. Give an
example of each case.
Transcribed Image Text:QUESTION 4.11: a. When transaction costs are low enough, efficient resource allocation will follow regardless of the particular assignment of property rights. When transaction costs are high enough, efficient resource allocation requires assigning property rights to the party who values them the most. Give an example of each case.
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