Mandatory price management dos and don'ts

Administered pricing is one of the policies that most governments implement to control prices, prevent inflation, and protect consumers. However, the experience of Iran and many other countries has shown that this policy not only does not reduce economic problems, but is also accompanied by widespread negative consequences. A more in-depth analysis of this issue is provided below. An administered price is a price that is determined by the government or a regulatory body, not based on the market mechanism (supply and demand). In this type of pricing, the government or the responsible body determines the price of goods or services with the aim of controlling the market, preventing excessive increases or decreases in prices, and protecting consumers or producers.