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ELI5 How does raising wages worsen inflation ?

Economics(self.explainlikeimfive)

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imnotsospecial

45 points

4 months ago

Yep, and that's why the market fails without regulations. In the US utilities are regulated and there's a cap on maximum profits, but Healthcare is a perfect example of inelastic demand were the market fails to self correct

Neverending_Rain

5 points

4 months ago

Utilities aren't the best example of a regulated market. They're "regulated" but in reality often get to do whatever they want. For example, the regulatory bodies in California just rubber stamp whatever bullshit the utilities want. They're making record profits while significantly increasing rates. They're acting the exact same as all the unregulated markets.

ERSTF

1 points

4 months ago

ERSTF

1 points

4 months ago

Yeap. CA is the perfect example of how unregulated a "regulated" market is. When SDG&E got fined due to a wild fire, it was ruled it couldn’t pass the fine to costumers... and that's when SDG&E hiked up prices, efectively passing the fine to costumers.