Investors have spent years unlearning the lessons of Economics 101. Now, they may even need to accept that price controls have a place in the policy tool kit.
As Liz Truss on 6 September became the UK’s 56th prime minister, she all but confirmed that freezing energy bills will be her first big policy move. The yearly maximum that British suppliers are allowed to charge households is due to rise to £3,549, equivalent to $4,088, in October — an almost threefold increase from a year ago. The government’s plans are widely believed to include capping bills at around £2,500 for 18 months and compensating energy firms for their losses.
