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Philip Koop's avatar

The Mystery of the Current State of the Economy reminds me of the Air France Flight 447 crash. When your instruments are giving you confusing messages and not responding the way you expect to your control inputs, doubling down those inputs is probably not going to fix the situation.

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gregory byshenk's avatar

Just for info: here in the Netherlands we will be adopting a variation of the "tiered tariff", where the price for gas will be limited to €1,45 per cubic meter for the first 1,200 cubic meters, and for electricity to €0,40 per KWh for the first 2,900 KWh, with standard market prices above these limits.

As Sandbu suggests, this seems a reasonable compromise. Yes, it means that some people will receive the benefit even if they don't need it, but there are instances - and this temporary measure seems to me to be one of them - where the costs of means testing exceed the benefits. But it also lets "the market" do its job above the minimum, thus discouraging excessive consumption.

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