Every form of policy depends on the available structure existing in a country, when it comes to price regulation policy, it is one of the major policy used to ensure manufacturers or retailers don't lay heavy charges on their customers turning them into a money cow. Business is all about making profit and the more profit a business holder makes the greater his/her chances of improving the business. The rate of fund invested from profit made in a business tends to decide how long a business stays afloat, this is a fact known to all business owners. In order to ensure businesses stays afloat, every business owner strive to make as much profit as possible even if it means using all kind of ways to exploit the masses. To prevent this exploitation, comes the price regulation policy but the thing about this policy is that it is not fully functional in all countries or should I say, some countries only implement it partially on main products. Like I said earlier, a country's structure tends to determine the potency of a policy. In developed countries, they understand the need and relevance of price regulation policies due to how advances and developed they are but for other countries, it is just one of those policy that exist on paper without any effect in practical. Example of such countries is Nigeria, I know this because I'm also a Nigerian. This is not about shading a country but just stating what is and what isn't. I'm not so accustomed to price regulation policy in my country, probably due to its less potency, I mean if it was really a thing around here, I should find it difficult to point out its relevancy and effects on our economy.
As far as my knowledge and experience goes, there are very few products that falls under the category of commodities or products that the price can be regulated, petroleum, diesel, gas, kerosine and any other products of crude Oil. The regulation of the prices of these product by NNPC is a little effect compared to most products that are said to going through price regulation. The reason behind this is that, the government knows how heavily dependent we are on these products for survival but as far as I'm concerned, regulating of these product prices is becoming less potent every day. I guess it is something about the present administration, because a lot of good policies have been somersaulting lately due to lack of ability to maintain the policy by the present administration. In those days when I was still a little bit young, if any petrol station should dare increase the cost of petroleum per/liter above the price set by NNPC, such petrol station will be closed and forced to pay an heavy fine but these days, it is no longer a thing. In one street, you can find at least 4 petrol station selling Petro or diesel at different prices. The worst part is, if you have to travel from one state to another, it is better you have a reserved petrol in a keg somewhere safe in your car or else, you will be victimised due to the different rates of petroleum prices. Which means the cost of petroleum in one state is not the same in another. The only place in my country that sells petroleum and any other crude oil materials at the same price regardless of the place you are buying is NNPC. That is why most times there are a lot of people queuing to buy from them even when it is available in other places.
Do I think price regulation is a good thing? in a well structured country, I would say yes. Without price regulation policy, we citizens are at the mercy of manufactures whose primary motive is increase in profit margins. Remember I said in a well "structured country", In a country with an unstable economy, a policy such as this puts manufacturers in a difficult spots. I mean if as a manufacturer, the cost of producing a product is high due to lack of provision of social amenities and Infrastructure by the government but still, the government comes around and forces me to sell my product within a price range. It is evident that I wouldn't be able to make much profit to sustain the business for long, which will leave manufacturers with only two choices, close down the business due to bankruptcy or move to another country with a more convenient environment for businesses to strive. In as much as price regulation is important to prevent the citizens from manufacturers and retailers exploitative tendencies, it is also important that the policy do not deprive manufacturers from making profit to sustain their business.
This write-up was inspired by weekly featured content titled Price range in hive learners community.
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