At the same time, the government's National Development and Reform Commission banned any increases in the maximum permitted prices for medicines, air and rail trips and certain agricultural commodities like wheat, rice and cotton.
But their products are usually several times more expensive than domestic alternatives, partly because they work better, and partly because consumers are willing to pay a premium for the cachet of a foreign brand.Instead of fixing permitted prices, the new caps will specify profit margins.
If so, antitrust law may come into play, just as it did two to three decades ago in the upending of "ethical" rules that banned advertising or permitted price-fixing by lawyers.
After permitting price hikes for commercial and industrial users earlier this year, it has secured deals with a few more foreign utility firms.
Mrs. Ninci, who used to run a clothing store, said there was an immense difference between liberalizing store hours and permitting price wars.
While expenses for insurers may well be rising in New Jersey, as elsewhere, industry executives said it was difficult to predict whether those costs would be offset by legislative changes aimed at reducing fraud and litigation and, if not, to what extent political leaders would permit price increases.
A CGE model complements theoretical results, suggesting that the change in the equilibrium permits price brought about by taxation can be significant.
The permits — priced at $1,000 per month, with the department taking 10 percent of earnings — cost far less than opening a brick-and-mortar business.
When market conditions won't permit prices to climb in relation to these wage costs, profits dwindle, risk capital disappears, and job-creating business expansion grinds to a halt.
However, it is possible to design an enforcement strategy that shields enforcement costs from abatement-cost risk by tying sanctions directly to permit prices.
