2020/11/17 by David A. Anderson · 1 citation
Economics, Econometrics and Finance · #Climate Change Policy and Economics #Law, Economics, and Judicial Systems #Fiscal Policy and Economic Growth
paper · pdf · doi:10.3390/economies8040100
openalex publication_date 2020/11/17 · openalex created_date 2025/10/10 · openalex updated_date 2026/07/22
Externality problems hinder solutions to existential threats, including climate change and mass extinction. To avert environmental crises, policymakers seek mechanisms that align private incentives with societal exigencies. Successful solutions bring individuals to internalize the broad repercussions of their behavior. In some cases, privatization, Coasian bargaining, or Pigouvian taxes effectively place the weight of externalities on the relevant decision makers. Yet, the available remedies often fail to provide satisfactory outcomes, and inefficiencies persist in the markets for energy, transportation, and manufactured goods, among others. This article explains how a simple voting mechanism can achieve socially optimal decisions about many of the innumerable externality problems that remain.