(Answered) Approximation to actual markets abstraction

Economics

Problem: If there were no transaction costs, firms might not exist. Explain how - if there were no transaction costs and property rights were assigned - externalities could be solved (internalized) through negotiation (market forces). How close an approximation to actual markets is this abstraction? Can carbon emitters bargain with future generations? Explain your answer and provide examples.

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Macroeconomics, Economics

Category:- Macroeconomics
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