I've been following this fairly closely. It seems that the main thing that causes this is government control of production, and price controls. The Nordics (h

I've been following this fairly closely. It seems that the main thing that causes this is government control of production, and price controls. The Nordics (held up often as a "good" model of socialism) is a welfare state. They increase taxes on the rich, and redistribute the money to the poor to narrow societal inequality. They do _not_ mess around with the basic laws of supply and demand, or nationalize production mechanisms. A socialist government sets price caps for certain goods, and nationalizes companies who refuse to produce for less than their costs, i.e. nationalizing production mechanisms. Also they messed around with currency exchange rates. Econ 101 will tell you that if you set artificially low price controls on goods, you will run into shortages, as there is no incentive to produce. And if you nationalize factories and replace talented employees with party hacks who toe the line, production will drop further, exacerbating the problem. Venezuela was able to avoid this for a while by importing goods with oil money, but even when oil prices were high, they had shortages of goods. https://foreignpolicy.com/2015/06/10/venezuelas-last-hope-leopoldo-lopez-maduro/ https://foreignpolicy.com/2015/06/10/venezuelas-last-hope-le... (search for "during the Chavez years") Now they can't afford to import food or raw materials anymore, because they have no hard currency reserves, and 100 bolivars (the largest denomination bill they have) is worth roughly ten cents, and the government won't change them into dollars at any rate unless you're connected. To their surprise, you can't just decide to product food and start up factories after a multiyear hiatus. You can't spin up crops, and agricultural and industrial institutional knowledge has been lost, or has fled the country.