Can price caps bring down grocery bills?

Ahead of the 2026 midterms, affordability remains top of mind for many voters across the country. Among the top affordability concerns is how much we’re spending at the grocery store.

Overall food prices were up 2.9% year over year in January, according to the latest consumer price index reading. Annual increases for things like coffee, sugar, and beef all exceeded that rate.

So how do you bring prices down and ease the burden on consumers? The Center for American Progress is out with a new report looking at one potential solution: price capping, which is the practice of setting maximum prices on certain products, no matter the market conditions. It’s an idea that may certainly be popular with inflation-fatigued consumers, but that’s not the case with many economists.

“Marketplace Morning Report” host Sabri Ben-Achour spoke with Dr. David Ortega, professor and Noel W. Stuckman Chair in food economics and policy at Michigan State University, on the reality of price controls. The following is an edited transcript of their conversation.

Sabri Ben-Achour: Whether it’s government-mandated control over prices or some sort of arrangement for grocers to reduce their own prices, economists are not usually thrilled with the idea of price controls, to put it mildly. Why is that?

David Ortega: Well, it's because you're really tampering with the market mechanism, and it can lead to unintended consequences — things like shortages and sort of misallocation of resources. So, when you have prices that are capped below the market-clearing levels, producers have less incentive to supply those goods, and so they may shift to some of the uncapped alternatives. So to speak, you also end up with quality issues. It's also a bit of a sort of blunt targeting. You know, these caps don't distinguish between price increases from, say, things like corporate profiteering or shocks that have sort of affected the market, and so a cap really penalizes both of those equally.

Ben-Achour: Is there an argument for temporary price controls? You know, yes, you'll have negative consequences, but maybe it's worth it for people to get a break on food prices for a short period of time.

Ortega: So, it's just a temporary Band-Aid that can actually end up doing a lot more harm than good. So, I think in order to get food price inflation under control, we have to sort of address the root cause of the issue. You know, what's happening with supply chains and the shocks and input prices, and also looking at sort of the demand side. But right now, we're in a sort of period where there's tremendous uncertainty, not just in the food industry, but in the economy more generally. And that uncertainty, in and of itself, can be inflationary because it increases transaction costs as companies try to stay on top of an ever-changing economic environment.

Ben-Achour: Are there specific things the government can do when there's a shortage of something or a supply chain disruption? I mean, can they take specific actions to bring more or cheaper food or commodities in?

Ortega: So, I think, the actions that help here are those that address the root cause, investing in supply chain resilience and agricultural research and development. You know, these are investments that have to be made now, because it takes years for them to pay off, and this is how we can keep productivity up in the agricultural and food sector that will ultimately keep prices from increasing like we saw a few years ago. We need the best science, the best technology to be able to meet current and future challenges.