Combating inflation, Vietnamese style

Posted By Blake Hounshell Tuesday, August 5, 2008 - 10:18 AM Share

What do you do if you're a growing, quasi-capitalist dictatorship and you're confronted by the specter of rising prices?

If you're Vietnam, you simply outlaw them:

Vietnam announced tough measures to contain rampant inflation on Monday, warning companies they could be prosecuted for passing on higher commodity costs to customers.
The government will prosecute or revoke the licences of companies that increase the prices of goods without sufficient justification, part of a plan to freeze prices for the rest of the year on goods ranging from coal to public transport.

At 27 percent, Vietnam suffers from the highest rate of inflation in Asia. But simply banning it isn't going to work -- it will just create shortages and black markets -- and moreover it sends the wrong signal about the country's direction. It seems Vietnam's rulers still have a lot to learn about this whole capitalism thing.

EXPLORE:SOUTHEAST ASIA, ECONOMICS

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PMG1704

10:01 AM ET

August 5, 2008

Fighting inflation

Fighting inflation Zimbabwe-style...

JOSHUA.FOUST

12:34 PM ET

August 5, 2008

Yes!

Blake, OMG TOTALLY, because only quasi-capitalist dictatorships or the Vietnamese would EVER impose price controls! Nice insight.

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