The blat economy described in the text results when price controls are:
A) extensive and cause chronic shortages in the economy.
B) extensive but the causes of shortages in the economy are only temporary.
C) short-lasting but cause chronic shortages in the economy.
D) short-lasting and cause only temporary shortages in the economy.

Question

Quizplus · Accepted Answer

The term "blat" refers to informal networks and bribes used to obtain scarce goods or services in a government-controlled economy. Price controls often lead to shortages of goods, and this can result in the development of a blat economy in which people use connections or bribes to bypass the shortages and obtain what they need. Chronic shortages suggest that this system of informal networks and bribery is extensive and ongoing in nature, which supports choice A.

The Blat Economy Described in the Text Results When Price