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Floor Ceelings

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I do not believe that the government should impose price floors or price ceilings; instead they should allow the process of supply and demand to dictate the equilibrium price which serves as the rationing mechanism. Price ceiling artificially keeps prices from rising too high, which in theory allows consumers to afford the product or service, but can result in shortages and rationing. A price floor keeps prices from falling too low, which can protect producers, but can generate excess supply and waste if it is higher that the equilibrium price. Understanding and implementing the exact balance of price floors or price ceilings can very difficult for regulators to forecast. Since they are not self correcting processes, one of the negative effects would have to manifest before an adjustments could be made.

I believe that there is an excessive amount of regulation in our economy and it creates more problems than it is supposed to solve. Every regulation has some sort of associated cost of compliance which can increase the total cost of operation for businesses. This cost could prevent new businesses from entering into the market and allow existing firms to continue to generate a profit, which in turn monopolizes the industry. Excessive regulations not only disrupt market processes, but can also have some unintended consequences. These unintended consequences can and usually lead to more regulations to fix the unintended consequence which creates a cycle of regulatory fixes. With that said, not all regulations are bad when implemented in moderation and focuses more on protecting individual rights of instead of attempting to control our economic

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