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Which force farmers would stop earth cultivation, and cattlemen it for It paid - more than rents of farmers, but it is less, than value it. Now we will assume that cattlemen should not indemnify a loss from it. As losses of farmers will appear big, than their rents, their income becomes
It is less, than at best of alternative kinds of activity, and they will refuse
Earth cultivation if only cannot induce cattlemen to refuse from
Their activity. But a maximum of that farmers will agree to pay for it,
Will be a bit less than their rents. As rents of cattlemen from their continuation
Activity (with accompanying it crops) more than rents of farmers,
Farmers cannot pay, how much it is necessary to induce cattlemen
To refuse their activity. In these conditions, the same as and in the previous
Case when cattlemen have been obliged to indemnify a loss, the earth will not be
To be cultivated and farmers will address to the best alternative activity, and
Cattlemen will be engaged in the business. As before, change of a legal position
Does not render influence on placing of resources. Moreover, finally we
We receive such placing of resources which maximises value
Manufactures. We will assume that rents of cattlemen are equal 100 dollars, value
The poisoned crop it is equal 50 dollars, and rents of farmers - 25 dollars If and
Cattlemen, and farmers will continue the activity, value increase
Manufactures 75 dollars (will make 100 dollars plus 25 dollars a minus 50 dollars). If
Cattlemen will throw the activity, the increase in value of manufacture will make
25 dollars (rent of farmers) and if only cattlemen continue the
Activity, increase in value of manufacture 100 dollars (rents will be equal
Now we will imagine a situation, return just considered, and
Let's look that will be in a case, when value of the poisoned crop above, than
Rents of cattlemen, but it is less, than rents of farmers. We will assume at first that
Cattlemen bear a damage liability. As they should pay in
Indemnification kind more than the size of their rents, cattle breeding will stop, and
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