Final answer:
Class-action lawsuits are favored over negotiations with polluters because they allow plaintiffs to pool resources and represent individual claimants who may be unaware of their legal standing, efficiently addressing collective grievances against polluters responsible for environmental damage.
Step-by-step explanation:
Class-action lawsuits are more prevalent against polluters than direct negotiations between victims and polluters due to several factors. Firstly, class-action suits allow plaintiffs to share costs and consolidate claims, making legal action more accessible to those who may not have the means to undertake it individually. Also, these suits can cover individuals who might be unaware they have a legitimate claim. The expenses associated with filing a lawsuit are distributed among a larger group, which alleviates the financial burden on any single plaintiff.
Moreover, the environmental costs of many products are not included in the goods' prices, which leads to externalities being borne by selected individuals, such as those living near pollution sources like oil refineries. They suffer health consequences like increased cancer risks from benzene exposure, while the broader consumer base enjoys the benefits, such as cheaper fuel. Therefore, by filing a class-action suit, these affected individuals can attempt to hold polluters accountable and seek compensation for bearing these environmental costs.
Additionally, pollution taxes create incentives for firms to invest in cleaner technologies or pay the tax otherwise. However, because of the potential high costs of reducing pollution, some firms may opt to fight regulations or taxes, which can also lead to litigation. Without such taxes or regulations, there would likely be more cases of environmental damage going unresolved, thus necessitating the need for class-action lawsuits.