Question

What are the difficulties encountered in assigning monetary value to resources?

Answer 1

hey,

Assigning monetary value to resources by supply and demand in a free market is optimal as it is the market itself which assigns this value, and the result is that there should not be surpluses nor shortages, unless the market is interfered by governments, as is usually the case. When this happens, as it usually does, then we end up with surpluses and shortages, but, most frequently, surpluses of labor (unemployment) and shortages of goods and services.

In command economies, when value is arbitrarily assigned by government bureaucrats, even bigger shortages appear, and government corruption becomes even more rampant, as generally the law is seldom enforced on bureaucrats...