Evaluating the likely micro- and macro-economic effects of price controls. Price controls are legal restrictions on the maximum or minimum prices that can be charged for a good. They are imposed by governments either in for the long-term because of structural problems in a market or political choices, or as short-term provisions in an emergency. They work by making it illegal for traders and consumers to buy or sell goods outside of the set price. If a government imposes a maximum price above the market equilibrium, or a minimum price below the market equilibrium, this should not have any effect on the market equilibrium. Instead, a maximum price for rent, for instance, set above the equilibrium, would in theory restrain bad landlords from exploiting renters. Those economists who believe in free markets would say that landlords should be allowed to practise first degree price discrimination and to charge whatever the market will bear (whatever someone is prepared to...