Price Control Could Discourage Innovation, Hurt Market Competition – Analyst
By: Solomon Nartey Tetteh
Economic Policy Analyst Ebenezer Otu Okley says poorly designed price controls risk stifling innovation, weakening competition, and undermining efforts to improve product quality in Ghana’s markets.
Speaking on Business Breakfast on Zed, Mr. Okley explained that competition driven by disagreement, improvement, and innovation is a key force behind societal and economic progress. He noted that companies consistently strive to outperform their competitors by investing in research, improving product quality, and developing new ideas.
“In every society, conflict and competition drive growth. We disagree, we improve, and that’s how progress is made,” he said. “Companies want to be innovative. They want to beat their competitors, and they deserve to be compensated for producing better, higher-quality goods.”
He warned that strict price controls could discourage businesses from investing in research and development. According to him, firms may hesitate to improve their products if government-imposed prices prevent them from recovering the cost of innovation.
“If I invest heavily in research to improve my product and the government later dictates the price, it becomes difficult to justify that investment. Price control doesn’t tell a good story when it comes to encouraging competition,” he explained.
The Policy Analyst also highlighted how human behavior and market dynamics are contributing to price distortions in Ghana, despite efforts by farmers and the government to stabilise supply.
Mr. Okley cited the example of the egg market, explaining that while farms are producing an abundant supply of eggs, prices in the market remain high, creating what he called “artificial inflation.”
Mr. Okley stressed that official inflation figures, calculated by the Ghana Statistical Service, take into account a comprehensive basket of goods across farms and markets.
He warned, however, that individual market experiences can mislead the public and create unnecessary economic anxiety.
However, Mr. Okley stressed that while competition is essential, it must still operate within a regulated framework to ensure fairness.
