What are likely consequences of information externalities


Problem

An important class of externalities to which attention has recently been directed is called information externalities. The information produced by one individual or firm generates benefits for others. The success of an oil well on one tract of land increases the likelihood of oil's being found on an adjacent tract, and hence increases the value of that tract. Can you think of other examples of information externalities? What are the likely consequences of information externalities for the efficiency of resource allocutions? Discuss the possibilities of private market solutions to these problems.

The response should include a reference list. Double-space, using Times New Roman 12 pnt font, one-inch margins, and APA style of writing and citations.

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Microeconomics: What are likely consequences of information externalities
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