picture from: http://upload.wikimedia.org/wikipedia/commons/6/6f/Bread_in_Boudin.jpg
http://en.rian.ru/business/20120808/175068345.html
“Russian bread prices may rise 5-10 percent in the fall in the wake of rising grain prices driven by drought in some of Russian regions”.
This article brings up an issue of bread prices rising in Russia due to unsuccessful yield of crops this year. Higher cost force the producer to rise the prices.
So should the main supplies, like water, gas, bread, in this case- correspond to the real market price? Should government subsidise those, or just set a price cap?
This question is a wide field for debate which eventually hits a question of whether or not should the firm only care about profit maximization no matter what cost?
Possible solutions? Id say “per need” system could work. The idea is to sell the product cheaper (possibly with zero or minial profit) to those, who posses certain kind of “in need” identification. This easens burden for firm (no ethical problems) and for government (no need to subsidise whole industry, just a part of it).
But there is an option, when firm would not want to pay any “moral” debt to society it operates in. What than? In that case, such institutions as governments still exist…