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That's only in so-called 'fair price shops'. In practical terms they run out of (or claim to run out of) foodgrains before demand is met. This subsidised materi

• jerf 10y ago
  Even if there wasn't any fraud involved, the expected result of forcing prices for the end-consumer below the market price is shortages for the end-consumer. Since people often tend to mentally model the non-end-consumer part of the chain as having infinite supply (since in their day-to-day lives it appears to be the case) in their mind, that is often counter-intuitive. It may be easier to understand the flip side of the same principle, which is that if you hold the price above the market price, you'll end up with excesses left unsold, because insufficient numbers of consumers want to buy at that price. Since this is phrased in terms of the end-consumers not wanting to spend more than they want to, it's less counter-intuitive, and perhaps less politically offensive to some's sensibilities. But it's the exact same effect.