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#61
08-29-2005, 08:22 PM
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Re: Supply and/or Demand?
[ QUOTE ]
You can argue that its "unfair" but there is no adverse long-term consequence of putting a very short-term price ceiling on the hotel industry in a small geographic area. [/ QUOTE ] Here's where I think a lot of tinkers make a mistake. I've had several businesses I gave up on or sold because the government meddled. It has nothing to do with how much money it is. When the gov't began telling me what I could and could not do -- I had to seriously ask myself if I wanted to invest more of my money and time into a business they controlled. The problem with regulators is that you never know where they're going to stop. When they finally said it was illegal to smoke in a bar -- even if you own the bar -- even if there were warnings posted outside -- you know they can do anything. "adverse long-term consequence" can come in many forms. 
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#62
08-29-2005, 08:28 PM
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Re: Supply and/or Demand?
[ QUOTE ]
Here's where I think a lot of tinkers make a mistake. I've had several businesses I gave up on or sold because the government meddled. It has nothing to do with how much money it is. When the gov't began telling me what I could and could not do -- I had to seriously ask myself if I wanted to invest more of my money and time into a business they controlled. The problem with regulators is that you never know where they're going to stop. When they finally said it was illegal to smoke in a bar -- even if you own the bar -- even if there were warnings posted outside -- you know they can do anything. "adverse long-term consequence" can come in many forms. [/ QUOTE ] I sympathize but believe in this instance that the argument is purely hypothetical and that you are unlikely to find any empirical support for these short-term controls having an adverse long-term effect. I agree with you 100% about the smoking regulations.
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#63
08-29-2005, 09:02 PM
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Re: Supply and/or Demand?
[ QUOTE ]
Here's where I think a lot of tinkers make a mistake. I've had several businesses I gave up on or sold because the government meddled. It has nothing to do with how much money it is. When the gov't began telling me what I could and could not do -- I had to seriously ask myself if I wanted to invest more of my money and time into a business they controlled. The problem with regulators is that you never know where they're going to stop. [/ QUOTE ] Exactly. Nobody is going to not build a hotel because of a single, isolated price cap for a few days. But they will re-think their plans if there is an environment of oppresive governmental meddling (and look for somewhere less oppressive), and price caps are a strong indication of such an environment.
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