Economists Tend to Distrust Voluntary Approaches as a Way to Deal

question 152

Multiple Choice

Economists tend to distrust voluntary approaches as a way to deal with externalities. What is their most common concern?

• A) Voluntary approaches do not make people develop an awareness of the problem that would lead them to make good lifestyle changes.
• B) Voluntary approaches often are perceived as unfair, imposing a heavy burden on the poor.
• C) Voluntary approaches usually require people to ignore their self-interest, and economists do not think people do that well.
• D) Voluntary approaches are often too effective and lead to excessive reduction in the externality.

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Definitions:

Enovid-E 21

A pharmaceutical preparation previously used for contraception.

Ortho-Novum

A brand of oral contraceptive pills used to prevent pregnancy.

Formalin

An aqueous solution of formaldehyde gas; commonly used as a disinfectant or preservative in medical laboratories.