A $1,000 per month cash handout would grow the U.S economy by $2.5 trillion, new study says

[freedquaker]

So explain how price regulation on the bread that you already understood doesn't work would suddenly work for anything else.

I already told on this very thread what happened to ALL prices being frozen in Brazil.

freedquaker said:

I am sorry, "nobody taught me?" I am a college professor in several institutions across two countries (9 months in the US, summers in another), and I know everything that they teach because I have been teaching the same things for the last decade! So please do not repeat the undergraduate introductory material to me, because pretty much all of it is either B.S. or simply inaccurate ideological propaganda.

Price controls may make things very bad or good, depending on the market conditions. MINIMUM WAGE, for instance, can be detrimental or beneficial to the economy. At college, of course, they only teach the ideologically convenient (neoclassical) solution, which is, do not interfere the market at all. In the neoclassical mindset, the minimum wages are completely evil. HOWEVER, that is NOT what the real data suggest, according to which, minimum wages have either no or negligible effect on the economic efficiency, and if at all, the effects are temporary. So with no real effect on efficiency, minimum wage in the US only re-distributes income but has no bearing on the market efficiency (unlike what the neoclassicals would claim!) and this is a FACT (for the US)!

How can that be? BECAUSE the markets are NOT perfectly competitive (unlike the fundamental assumption!). It is TRIVIAL to show that, increasing minimum wage (a type of price control), may actually increase efficiency as well as improving income inequality, IF the markets are NOT competitive to begin with. The exact same is true for the real estate markets, which are usually not competitive (but often held by a strong rich elite), causing IMPERFECT market prices and artifically low housing supply. This is why there are MORE VACANT HOUSES THAN THE HOMELESS in the US, as the owners are waiting for a higher bid!

If you want to go into the specifics, only and only if you have at least a PHD in Economics, then let's discuss, otherwise, I am afraid, you won't have a clue about the details of how the economy works beyond the superficial millenial ideological propaganda they have given you. Hopefully you are not one of those who still think "college premium is due to rising productivity" nonsense.

The real evidence of a full market like Brazil clearly showed what happened on government doing price control full scale instead of sanitizing it's own cost structure and debt heavy strategy.

And basically your solution to a market that is imperfect basically because of government control is increase government control? Makes zero sense and you know it. You may have 20 PhDs if you want, but infering that increasing something ineficient will make it efficient is bizarre to say the least.

Like I said, price controls may be good or bad for the economy and it is a case by case situation, varying between the type of markets and economies. Brazil and US are VERY DIFFERENT end of the spectrum, and a policy that works perfectly in one may not work at all in the other. I believe you are coming from a Brazil point of view, about which I do not have sufficient information and a subsequent analysis, so I will reserve judgment on that. But you should realize that you simply cannot generalize your conclusions from one country, even one time frame, even a market to all.

Like I said, if the market is highly IMPERFECT (oligopoly, monopolistic competition, imperfect competition etc.), then the prices, by definition, are already higher than the equilibrium level, with an aritifcially restricted market output. In this case, establishing or raising the minimum wage to the virtual market equilibrium levels would, at the same time,

a) decrease the marginal cost of labor (as it is simply zero at the frozen minimum wage up to the equilibrium point)
b) thus increase the employment and market output (reaching to the market equilibrium)

However, if you go beyond that equilibrium point and raise the minimum wage too much, then the both the employment, and market output along efficiency will fall again. The problem with developing countries like Brazil is (among others),

a) There are too many market imperfections that need to be tackled before price controls (which also make it real difficult to have a real direct and clear results from the policy decisions),
b) The populist policies usually push the wage controls too high (for the economic efficiency, not necessarily sufficient for a decent living).

The very same thing can be said for pretty much all other markets with certain caveats.