The first and most obvious negative effect of a price ceiling is a shortage of the good (or service) the price of which is prevented by government from rising above the ceiling.

the shortages created by price ceilings necessitate the use of some means of rationing.

A price ceiling, in short, reduces the amount of the good that buyers actually get.

The reason price ceilings raise consumers’ costs of acquiring the good is that price ceilings prohibit only the monetary price of the good from rising. Price ceilings don’t – and cannot – prevent consumers from directly spending non-monetary (“real”) resources in their attempts to acquire the good. When consumers are prevented from competing to acquire the good by offering more money to sellers, consumers compete for the good in other ways, such as rushing to the store or waiting in long lines. Also possible is the offering of tit-for-tat favors. Some of these favors are innocuous, such as a buyer offering to a seller a six pack of beer. Other of these favors are corrupt, such as the town mayor offering to a seller an exclusion from a zoning requirement.

A price ceiling is that it reduces not only the good’s quantity, but also its quality. Because the amount demanded of the good exceeds the amount supplied, sellers who allow the quality of the good to fall will lose some potential buyers but will likely still be able to sell all the units they wish to sell. In short, you get what you pay for.