Chapter 10

I would give this chapter a difficulty of two. The reason is that while it is a lot of economic theory, it was a lot of economic theory. A lot of the concepts introduced were topics that we had talked about briefly or I had maybe thought a bit about, but not too much.  There wasn't as much overlap as there had been in the previous chapters. This chapter was important because it showed us the limits f the invisible hand. The invisible hand only takes into account the parties that take part in the deal, and not any other party that may be affected but didn't directly partake in the deal. Extranalities and market power are two of the reasons that a government is important to maintain an efficient economy. There are various ways to resolve extranalties as described in the chapter, and some of them don't even require government interference according to the coarse theorem.