Privatizing the World’s Second Largest Water Reserve South America will allegedly witness a privatization of the Guarani Aquifer, the world’s second largest known water reserve, by Coca-Cola and Nestlé. Negotiations with authorities are seemingly under way and, if successful, the contracts will last for a minimum of 100 years.

Source: truththeory.com, February 5, 2018

a. If this is not just a rumor, what is the externality that arises from privatizing water?

b. How can the externalities of privatizing reserve water be avoided?

c. Are there any advantages to privatizing reserve water?