There Is No Good Practical Case for Price Controls

Source: Cafe Hayek
by Don Boudreaux

“Jason Zweig suggests that price controls might be worth a try ‘when there’s a national will to see them succeed’ (‘An Old Way to Fight Inflation Gets New Fans,’ June 3). The chief piece of serious economic research he cites in support of his case is Hugh Rockoff’s 1981 paper, ‘Price and Wage Controls in Four Wartime Periods,’ that does indeed report limited and qualified evidence that wartime price controls sometimes might break expectations of inflation without seriously reducing economic productivity. But beware of the allure of price controls. First, economic historian Robert Higgs has demonstrated the unreliability of the wartime output measures used by Rockoff as a basis for concluding that wartime price controls had little negative impact on economic productivity.” (06/04/22)