Problems with costs are created when market forces are replaced by government regulated prices.
While tradable inflation moderated slightly, non-tradable and regulated prices such as energy accelerated once again, on the back of service price increases.
Their regulated prices made earnings and dividends pretty predictable with basic math.
FORBES: Entergy Or PPL, Which Is The Better Electric Utilities Play?
There is little incentive for companies to build transmission lines when they may be forced to open them up to all comers at politically regulated prices.
Venezuelan government hikes regulated prices on some commodities.
Hein Hettinga, a Dutch immigrant, exploited this to build a highly successful independent dairy and distribution business in Arizona that sold milk to outlets in California like Costco for as much as 20 cents below regulated prices.
FORBES: Opinion, Or Manifesto? Judge Slams High Court's Economic "Surrender"
Since September, the government has taken several measures to boost economic activity, such as allowing foreign supermarket chains to set up shop in India, permitting foreign airlines to buy stakes in local carriers and raising the state-regulated prices of some fuels.
Heavily regulated fuel prices have discouraged Chinese refiners from producing cleaner diesel, as the higher costs can't be passed on to consumers.
The devaluation also harmed Chemapol's pharmaceutical-distribution business, which cannot charge more for imported drugs whose prices are regulated.
While monopolies have more power to charge higher prices than firms in competitive markets, there are times when it makes sense to allow them if their prices are regulated.
Diesel prices are partially regulated, with the government allowing only small increases every month.
Tariffs are largely regulated by the government, keeping prices in check and encouraging greater mobile usage.
FORBES: Rural China Gets Smartphones, China Mobile Goes To $58
But the most severe penalty for operating a regulated monopoly is losing control of prices.
When he took over the Civil Aeronautics Board for President Jimmy Carter in 1977 air travel was regulated to the hilt, with prices, routes and returns all fixed and aircraft, which could compete only on the number of flights and the meals they served, flying half-full.
ECONOMIST: Alfred Kahn, deregulator, died on December 27th, aged 93
There have been warnings that commuter train companies reliant on regulated fares could be heading for financial difficulties should ticket prices fall and that some might cut services in response.
And there is to be a cap on how much regulated train fares can go up by - so ticket prices will not rise by more than 1% above the rate of retail-price inflation (RPI).
BBC: Conservative conference: Cameron rules out 'mansion tax'
Serum expects its own boost from finally entering regulated markets like the U.S. and Europe, where prices are 10 to 20 times higher.
When the price of oil and natural gas was highly regulated, back in the 1970s, petroleum production failed to respond to rising prices.
FORBES: America's Resilient Economy: What Happens When Things Go Wrong
In just a few chapters, he outlines the forces that brought the world to the brink of a bust: a house-price bubble boosted by runaway mortgage lending in the rich world, particularly America, a lightly regulated global financial system that found ever-more creative ways to speculate on rising house prices, and macroeconomic policymaking that was far too laid back about the dangers posed by asset-price bubbles.
ECONOMIST: The reasons for the crisis and how to stop it happening again
应用推荐