Stopping illegal immigration would mean that wages would have to rise to a level where Americans would want the jobs currently taken by illegal aliens.
Thomas SowellRead
Four things have almost invariably followed the imposition of controls to keep prices below the level they would reach under supply and demand in a free market: (1) increased use of the product or service whose price is controlled, (2) Reduced supply of the same product or service, (3) quality deterioration, (4) black markets.
Interpretation
What this quote means
Government price controls can lead to negative consequences such as shortages and deterioration in quality.
In this quote, Thomas Sowell outlines the common repercussions of implementing price controls in a free market economy. When prices are kept artificially low, demand for the product or service increases; however, suppliers are disincentivized to provide enough of it, leading to shortages. Additionally, as quality may decline due to the reduced profit margins, alternative markets may emerge where the product is sold at a higher price, further complicating the effects of the controls.
Themes
Price ControlsFree MarketSupply And DemandEconomicsBlack Markets
In practice
Example use cases
In a discussion about government intervention in the economy during a seminar.
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