Venezuela
Half a century ago, Venezuela was the world’s second oil-producing country. Its production began in the country back in the 20s by large American companies (“Death by Socialism”). Oil provided 90% of exports and 60% of budget revenues (“Death by Socialism”). The country quickly became the leader in Latin America in terms of living standards. However, the video shows that at the time of its shooting, Venezuela was one step away from the onset of hyperinflation, and there was a strong decline in GDP above. The growth of economic problems led to a political crisis in Venezuela. The socialist rhetoric of the country’s leadership has led to long queues, cards, multiple currency rates, and the development of a black market (“Death by Socialism”). Under socialism, the sphere of supply and demand is regulated by the state. It did not have time to respond to the emergence of demand and provide supply, which led to a severe shortage in the Venezuelan market.
New York City
The price ceiling for rent in New York was a legally established maximum price that the seller has the right to request for rent. Any price below this ceiling is quite legal, the price exceeding it is illegal (“Price Ceiling”). Brent price ceilings in New York were set on the grounds that they allowed consumers to rent housing that they would not be able to afford at equilibrium prices. Price ceilings, or general price control, were used by city government to limit inflationary processes in the economy (“Price Ceiling”). They regulated the demand for housing in New York by providing the supply exactly to the extent that the market requires.
Works Cited
“Death by Socialism.” YouTube, uploaded by John Stossel, 10 Jan. 2017.
“Price Ceiling — Rent Control Example from John Stossel.” YouTube, uploaded by mz lz, 25 Mar. 2012.