Government interventions for dealing with externalities

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Reference no: EM132120219

When a gun is produced and sold, there is an externality: a chance that the gun will be shot at someone other than its owner. Use the analysis of externalities to determine a government policy that would likely improve social efficiency by decreasing the number of injuries and deaths from gun violence. Try to find the most socially efficient policy you can that the US Supreme Court would probably judge to be constitutional (not in violation of the Second Amendment, "A well regulated Militia, being necessary to the security of a free State, the right of the people to keep and bear Arms, shall not be infringed" or any other part of the US Constitution.) Explain why the policy you describe is unlikely to be found to violate the Second Amendment and why it is likely to be more socially efficient than other policies that would be found constitutional.

Hint: Consider the claims of R. Coase and/or the government interventions for dealing with externalities.

Reference no: EM132120219

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