The Effects of the Price Code

Abstract

Manufacturers' and distributors' views on the effects of the Price Code towards the end of Stage 4 are summarised in this article. Since the onset of the recession, market conditions rather than price controls have determined price-levels. Market constraints have limited the use of profit safeguards and low profit relief as well. The Price Code, however, was widely blamed for contributing to lower profit-margins, particularly in its earlier stages; this was mainly because of the productivity-deduction, lack ofpricingflexibility, and delays in obtaining price increases. Less generally affected were investment, sales and marketing activities, and price-differentiation. Views on the changes to the Code required in a reviving economy are summarised.