Mr. Jones' sewage affects Mr. Smith's drinking water. What measures could be taken to make Mr. Jones take into account the consequences of his actions when he disposes of wastes?

The law could require Mr. Jones to pay damages to Mr. Smith.
The law could encourage Mr. Smith to bribe Jones not to pollute.
The government could institute a sewage charge, requiring Jones to pay for each unit of sewage disposed.
Any of the above would make Jones aware of the unfavorable effects of his sewage.

Some people argue that the extinction of a moas of New Zealand (moas were giant flightless birds) was caused by over-hunting by the first human inhabitants. They see here a problem of:

public goods.
rent seeking.
the law of diminishing returns.
the commons.

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