Price Controls Are Disastrous for Venezuela, and Everywhere Else

by José Niño

Images of citizens waiting in lines to get basic goods — toilet paper, flour, milk — throughout supermarkets in Venezuela abound across the internet. Such surreal imagery is the norm in present-day Venezuela. From the 1950s to the late 1990s, Venezuela was Latin America’s most economically and politically stable country. Fast-forward to the present, and Venezuela is not only undergoing an unprecedented economic collapse, but it is also on the verge of becoming a failed state.

Understanding Venezuela’s Shortage Crisis

How could a country that was once so prosperous fall to such lows? Basic economics dictates that goods do not just vanish out of thin air. To comprehend the phenomenon of shortages in Venezuela, a cursory analysis of the economic measures passed by Hugo Chávez’s regime and his successor, Nicolás Maduro, is needed.

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