Inflation, is the simple answer. But what causes this? Why couldn’t society just keep on keeping on with prices? Examples, a $0.25 for a candy bar, $0.75 for a fast food burger, $30k for a home etc. It worked then, so why not now, why not just agree to lower the prices of everything?
In: Economics
>Why couldn’t society just keep on keeping on with prices? Examples, a $0.25 for a candy bar, $0.75 for a fast food burger, $30k for a home etc.
Interestingly that is how the Communist USSR – the government decided the prices, and it didn’t really matter what the cost of productions was. The observable problem with government set pricing is that it result in goods no longer be available to buy, and wait lists for getting access to products. Once you have waitlist corruptions starts, because who would not want to pay some government official an extra $100 to jump the line.
And that is why we don’t like Communism.
Latest Answers