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Major criticisms of shadow pricing include its reliance on subjective assumptions and estimates, which can lead to inaccuracies in representing true economic value. Critics also argue that shadow prices may not adequately account for market imperfections or externalities, resulting in misleading policy implications. Additionally, the complexity of calculating shadow prices can limit their practical applicability in real-world decision-making, making it challenging for policymakers to utilize them effectively.

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3w ago

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