128PART TWOSUPPLY AND DEMAND I: HOW MARKETS WORKeconomists usually oppose price ceilings and price floors. To economists, prices arenot the outcome of some haphazard process. Prices, they contend, are the result of themillions of business and consumer decisions that lie behind the supply and demandcurves. Prices have the crucial job of balancing supply and demand and, thereby, co-ordinating economic activity. When policymakers set prices by legal decree, they ob-scure the signals that normally guide the allocation of society’s resources.Another one of the Ten Principles of Economicsis that governments can some-times improve market outcomes. Indeed, policymakers are led to control prices be-cause they view the market’s outcome as unfair. Price controls are often aimed athelping the poor. For instance, rent-control laws try to make housing affordable foreveryone, and minimum-wage laws try to help people escape poverty.
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