Internalization of Environmental Externality in Dwellings: Review of Court Cases in Hong Kong in the Past Two Decades

Rita Yi Man Li ()
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Rita Yi Man Li: Hong Kong Shue Yan University

Chapter Chapter 2 in Law, Economics and Finance of the Real Estate Market, 2014, pp 27-43 from Springer

Abstract: Abstract In 1960, Ronald Coase suggested that there are many methods to solve the problem of externality apart from imposing Pigovian tax; internalization is one of those noted in relation to the Problem of Social Costs. This chapter studies the possibility of residents receiving their compensation from pollutant generators. Data collected from Hong Kong Law Reports over the past 20 years show that there has been a 40-fold increase in the number of water seepage court cases since the first case happened in 1994. The total amount of compensation has also increased substantially. There is, however, far fewer court cases related to residents seeking compensation from pollutant generators with regard to noise and air pollution. Possible reasons for this are the high transaction costs and low expected benefit derived from court cases.

Keywords: Externalities; Pollution; Housing; Court cases; Hong Kong (search for similar items in EconPapers)
Date: 2014
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Persistent link: https://EconPapers.repec.org/RePEc:spr:spbchp:978-3-642-54245-9_2

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DOI: 10.1007/978-3-642-54245-9_2

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