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    Government price controls

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    Laws regarding price floors and ceilings; shortages and surpluses.

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    1. There are federal and state laws setting minimum wages for workers. There are also city laws setting price ceilings for housing rents .
    a. Why are there laws setting minimum wages for workers and maximum rents for housing?
    These laws are attempts by the government to create a more equitable society, and of course some political gameplay is also at work. Renters and workers who benefit from these policies are voters, who will keep in office those who keep their rents low and wages high.
    b. Why are there no laws setting maximum wages for workers or minimum rents for housing?
    There is little to be gained by anyone from such laws. Workers would not gain, nor would renters, who want rents as low as possible. Society does not benefit by making rents high, as it would cause homelessness; low wages are also associated with social ills such as crime.
    2. It has been stated that price controls cause ...

    Solution Summary

    Laws regarding price floors and ceilings; shortages and surpluses.