Liberty Discussion on “Should the Government Control Price?”

Liberty Discussion on “Should the Government Control Price?”

Liberty Discussion is a program designed to engage and inform the core members on the ideas of market economy and classical liberal ideas. Discussions are made on the contemporary issues (local or national) through open market perspective. The article is selected and shared within the members to prepare oneself for the program. The program is organized at the venue of Bikalpa – an Alternative on every alternative Saturday (twice a month).

On, Saturday, 7 September 2019 regular participants gathered on the Bikalpa office for the regular formal Liberty Discussion. The discussion was titled in Article “Should the Government Control Price?”

As the discussion started, participants were eager to express their opinion. This week we had discussion on should the government “Should government control the price”. As we know, Government price controls are situations where the government sets prices for particular goods and services. For various reasons, governments may wish to intervene in a market to set prices. This can take various forms such as giving subsidy on different goods, making price ceiling, price controls, etc. Meanwhile, in discussion one of the participants share his frustrating experience regarding the price related issue. He said in a private monopoly market a consumer is forced to pay a high price on goods. So, there should be direct price-setting made by the government.  Speaking on it, one of the participants said that price is fixed by analyzing the market forces. The market pricing mechanism is the most efficient way for price discovery, where prices serve as an indicator for market participants. If we allow the government to intervene in the market and regulate a certain price then black Markets would also arise and there can be artificial scarcity in the market.  He also argued that we need to understand the meaning of market and entrepreneurship otherwise there will always have misinformation about the market.

The participants also curiously discussed what type of intervention is necessary for the free flow of the market. Price Controls are Market Distortions.  This leads to misallocation of scarce resources, malinvestment, and horrible shortages or waste.

Leave a Reply

This site uses Akismet to reduce spam. Learn how your comment data is processed.