Price controls involve government setting prices for products, goods or services at a non-market-determined level. In competitive industries, price controls typically have economically harmful effects but may be imposed for political reasons, especially during economic disruptions. The longer that controls on competitive prices are maintained, the more consequential and complicated the resulting economic problems are likely to become. Price controls for utilities and like services are a common and far less problematic governmental response to the market power that exclusive service franchises may create.
KeywordsPrice Regulation Price Control Minimum Price Natural Monopoly Rent Control
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