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Explain why zoning laws, which allow certain land uses only

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Reference no: EM133582334

Questions: Explain why zoning laws, which allow certain land uses only in specific locations, might be justified in dealing with a problem of negative externalities.

Explain why in areas where buildings sit close together tax breaks to property owners for installing extra fire prevention equipment might be justified in view of positive externalities.

  • If a good generates a positive externality, does the free market result in overproduction or underproduction of this good? (or is the amount produced "just right", i.e. allocatively efficient?) Explain.
  • If a good generates a negative externality, does the free market result in overproduction or underproduction of this good? (or is the amount produced "just right", i.e. allocatively efficient?) Explain.
  • How can government intervention into free markets correct for externalities? Explain and give examples for both positive and negative externalities.
  • What is a pure public good and how is it different from a private good? Which do free markets tend to produce efficiently? Which require the government to collect taxes and provide the good? Explain

 

Reference no: EM133582334

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