With consumer prices soaring 7.9 percent in the past year to a height not seen since 1982, some economists have recently turned for solace to the siren song of price controls. For example, Isabella Weber of the University of Massachusetts Amherst and Todd Tucker of the Roosevelt Institute have both recently written op-eds arguing for price controls as one solution to our economic woes. This is misguided. Price controls would be a huge mistake.
Let’s use the example of gasoline to see why: Average gasoline prices in the US are a little over $4 per gallon right now. That’s higher than they’ve ever been. What if we passed a law saying that gasoline cannot be sold for more than $2 per gallon, the price back in spring of 2020?
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