“Tough restriction will lead to a deficit”: economists about the government attempts to regulate products

After the indignant speech of Vladimir Putin that the products become “not pocket” to the population, the government took up the limitation of oil and sugar prices, and the Prosecutor General’s Office is looking for a cartel conspiracy in the market. We asked economists about what could come of it.

Ruben Enicolopes

Rector of the Russian Economic School (RASH)

The government’s statements about the readiness to regulate products of products are a gesture of some despair, since the country's economic crisis continues, and the authorities have not yet been developed effective measures to combat it. After all, the main problem is not in prices, but in the fall in the income of the population. But it is difficult to cope with this problem. Therefore, they are trying to deal with the one that can be solved by administrative methods.

Of course, to set the maximum price for a food product is a populist move, from the point of view of the economy, nothing is justified. After all, prices for oil and sugar have risen because world market prices have changed. The prosecutor's office said that she would look for signs of a cartel conspiracy that led to an increase in the cost of products. But there are no such evidence. We do not live in isolation and simply dependent on world prices.

As a result, if prices really begin to be rigidly adjusted, you will get a situation when the entire agricultural industry is in ruins - this is after the whole country was raised under the slogan of import substitution in 2014 under the slogan of import substitution. A rigid price restriction will lead to a product deficit - no one will sell goods at non -market prices. If prices are limited softerly - due to the export duty, the manufacturer will not leave the market, but the profitability of the business will begin to disappear, and there will be less and less investments to come to the industry. By the way, this is another indicator that it is impossible to make long investments in Russia - because as soon as you start making a profit, the state comes and takes it.

It remains to hope that, since conversations about limiting the price of products in Russia are every crisis, but often they do not lead to anything, and this time the authorities will be limited only to statements popular among people.

Georgy Ostapkovich

Director of the Center for Conjunctural Research of the Higher School

How much the state decided to take on a conducting role, we will be able to see only based on the results of the real fulfillment of this assignment. Of course, there will be some kind of regulation of oil or sugar prices. Perhaps this will be a specific maximum price, perhaps a certain price interval. We do not know which system the state will limit the cost of the product. In the end, gasoline prices (as one of the social goods) in Russia are also controlled, another thing is that the state regularly gives preferences to oil companies and oil refiners for price control. Whether the state of agricultural industry will give benefits, it is not clear.

What are food prices? This is a volatile unit. They can grow both seriously and collapse, since they depend on the factor not controlled by a person - productivity. In 2010, when the heat stood in Central Russia, all buckwheat burned, and the prices for it were three times. Then Altai harvested a good harvest, and Buckwheat returned almost to the starting price. The same situation was with eggs. Now sugar has grown in price one and a half times, which outrages people. But what happened: sugar is made from sugar beets, and this year it was planted 17% less fields than last year, and the crop was seriously worse. Beetroot was not enough to meet the demand of sugar factories, and the price of raw materials rose due to the deficit. But this is this year. And in the past there was overproduction, and sugar was sold much cheaper than average prices. Due to the cheapness of the product, entrepreneurs were forced to take loans, and this year the price rose so that the business could reach the balance.

What will happen if prices begin to be artificially limited? Judging by the similar experience in the countries of Latin America, Asia and Eastern Europe, there will be no positive effect: manufacturers will lose profitability and begin to leave the market, and after the government will report to reduce food prices, after a year in the regions its shortage will begin. We will have to return to the prices of today, but it will even be more difficult to hold them.

Anton Tabah

Chief Economist of the Agency "Expert RA"

Price regulation for sugar and oil is rather ritual political actions that slightly affect the market. Historically, some products and prices are important psychologically. The share of bread in the consumption of an average Russian, for example, is now relatively small even among poor people. But it is driven into us that “bread is the most important product”, and the prices for it are in the focus of the authorities, and the people, and journalists. Almost in the same category-sunflower oil and sugar-sand. Due to the decline in income and a weakened ruble, people spend more on basic products, and the authorities must somehow react. Although nothing needs to be done with this and there is no possibility, except for verbal interventions. The government will defiantly talk with retail networks or set the maximum price for the only variety of both products. The consumer in the store may not even notice this - but he will remember with warmth that they took care.

In addition, it is important to note that the prices for these products have risen strongly only in recent months, and in previous years, when everything has grown, they did not grow and even cheaper. However, we rarely notice a drop in prices.

Although the statements received a resonance, I do not think that the regulation of food prices in Russia will seriously change the vector. At least, there is no question of any Soviet systems - those people who remember well what happened in the USSR and understand that full supermarkets is what provides stability and consumer happiness sits in the government.

Natalia Orlova

The chief economist of Alfa Bank

In the moments of crises, the topic of control over the growth of prices for socially significant goods becomes relevant. For example, it was discussed after the devaluation of the ruble in 2014, when an inflation surge was observed. This year, as the head of the Central Bank Elvira Nabiullina mentioned in one of her speeches in October, "recommendations were given to limit the growth in educational services, in some regions, decisions were made on incomplete indexation of housing and communal services tariffs." These measures of administrative control do not mean at all that the prices of all goods on the counter are began to be totally set by the state.

By establishing maximum prices for socially significant products, the state is trying to fight the population of the population. Decisions on limiting prices simply say that the government does not have enough effective tools to provide targeted assistance to the population with low incomes, and you have to use price control in order to prevent a sharp drop in the standard of living of these households.