TIME: Post-Sandy Price Gouging: Economically Sound, Ethically Dubious

[Brian4Liberty]

With price gouging, the person wanting his beer to be kept cold would probably not buy it because it's not worth $6 for a bag of ice (evil price gougers ). Meanwhile, $12 for 2 bags of ice for the guy with a diabetic child is more than worth it.

It's for the children?

You severely underestimate the ability and desire of beer drinkers for a cold beer. (Assuming it is very hot outside and the power is off). Now the person with the child could explain their need as opposed to the beer drinker's need, but that would be counter to the laws of economics. It would be the option, or rather, the responsibility of the beer drinker to outbid the person with the child. Otherwise, more ice may never show up.

Once again, there is no inconsistency in being opposed to price gouging, and also opposed to price fixing laws. Likewise, one can be opposed to drug use, and opposed to the war on drugs at the same time.

[Lucille]

The Politics of Price Gouging: It's OK for Unions, Gas Station Owners Not So Much
http://reason.com/blog/2012/11/05/th...ing-its-ok-for

Gas station owners can't raise prices, which might actually encourage more gas suppliers to make the extra effort to bring in a bigger supply. Meanwhile, the city does nothing to stop the shaking down of electricians who traveled hundreds of miles to pitch in and help because it might screw with union supremacy in a ravaged city.

[LibForestPaul]

price gouging, intellectual property, witchcraft, boogeyman, santa clause, what do these have in common, they don't exist.

[LibForestPaul]

A grocery store or gas station won't restock as soon as they can?

So, you are nominating yourself to freely supply diesel generators to all the stations that are without power? Perhaps if suppliers were able to recoup the costs of preparing for disasters, there would not be such severe shortage during disasters. Nah, thats just crazy free market talk.

[W_BRANDON]

Price gouging certainly is not ethical nor is it smart business practice. However, I do not necessarily believe it should be illegal. Look at all the resources nationwide diverted towards programs, agencies and bureaucrats in charge of policing price gouging.

Stores attempting to capitalize on human desperation and natural disaster by looking for dramatically increased profit margins risk many potential long-term consequences.

If there was a gas station or other store I knew engaged in price gouging, I would go out of my way not to give them business and would tell anyone who would listen to do the same.

On the other hand, stores who deal fairly with customers during times of crisis and may even choose to accept lower profit margins or forgo profits entirely during the time may be rewarded with lifelong loyalty from their customer base.

[Brian4Liberty]

So, you are nominating yourself to freely supply diesel generators to all the stations that are without power? Perhaps if suppliers were able to recoup the costs of preparing for disasters, there would not be such severe shortage during disasters. Nah, thats just crazy free market talk.

Obviously they will need power to use their pumps, thus the "as soon as they can" caveat. If they have generators, or a pumping truck, or another means of pumping, they could start selling even before the electricity comes back on. And of course an owner could charge more to cover the lease or rental of additional equipment if the power was out long enough to make it worthwhile. That would not be categorized as gouging.

[Bohner]

It's for the children?

You severely underestimate the ability and desire of beer drinkers for a cold beer. (Assuming it is very hot outside and the power is off). Now the person with the child could explain their need as opposed to the beer drinker's need, but that would be counter to the laws of economics. It would be the option, or rather, the responsibility of the beer drinker to outbid the person with the child. Otherwise, more ice may never show up.

Once again, there is no inconsistency in being opposed to price gouging, and also opposed to price fixing laws. Likewise, one can be opposed to drug use, and opposed to the war on drugs at the same time.

As a beer drinker myself, I have my limits as to how much I would pay for ice. And my limit would certainly be much less than if I had a diabetic child who required refrigerated insulin.

Which is the point, the people who need the products more will always be willing to pay more. So during a time of shortages, the products will usually go to the people who need them the most. If ice were $2 a bag, I'd probably buy 3 bags for my 24 of beer. At $8 a bag, I'd probably either buy only one bag, or decide fuck it and drink my beer warm.

[Paul Or Nothing II]

Price gouging during an emergency is immoral. And there is more to business than getting the best price for a product any given minute. Of course in the long run, supply and demand rule, and an open, competitive market will set the appropriate price. An emergency is a short term, temporary situation.

Sure, if you run the local Quicky Mart, you could raise the price to whatever you could get from desperate people. But there's more to this world than economics. After the emergency is over, you may not have any return customers. As a matter of fact, if the customers are desperate or angry enough, your store may get burned to the ground, and in earlier times, you might get tarred and feathered and run out of town.

Whatever prices exist are the result of pre-existing demand & supply situation, so even if businesses voluntarily hold prices down then that means they are hindering the market-information about supply & demand, which is going to lead to greater price-spikes upwards because prices & profits are the mechanism thru which supply & demand dynamics is communicated so if they are held up then market wouldn't know that the supply & demand dynamics have changed, supply wouldn't increase in line with increased demand; in fact, this would merely postpone the inevitable price-spike but the longer the market-information is held up, the more people will feel the heat, that is, even the people that have nothing to do with the disaster will later on end up having to pay much more than they would have had the "price-gouging" occurred earlier so by holding down prices, there'd be an indirect wealth-transfer from those not affected by disaster to those who are affected by it, similar to the one that occurs when government socializes the cost of helping out disaster-hit areas.

Whenever market-prices are hindered, whether voluntarily or by force, the results will be the same, both situations will bear the same negative consequences. It only impedes market-information & prolongs the time required for producers to see the market cues thru increased prices & profits to go out there & arrange more capital to buy labor & other stuff necessary to increase production & supply.

It's like believing that instead of government forcibly redistributing wealth, people should voluntarily redistribute wealth, well, that would still have the same ill-effects of destruction of wealth because those whose labor is less productive are consuming more than they are helping produce. Therefore, one would always want those more productive (whose labor is in short supply) to have more so that others try to increase their productivity & increase the supply of the labor which is more productive & thereby help increase total real wealth (aka goods & services) in the economy, which benefits everyone.

[Feeding the Abscess]

Price gouging certainly is not ethical nor is it smart business practice. However, I do not necessarily believe it should be illegal. Look at all the resources nationwide diverted towards programs, agencies and bureaucrats in charge of policing price gouging.

Stores attempting to capitalize on human desperation and natural disaster by looking for dramatically increased profit margins risk many potential long-term consequences.

If there was a gas station or other store I knew engaged in price gouging, I would go out of my way not to give them business and would tell anyone who would listen to do the same.

On the other hand, stores who deal fairly with customers during times of crisis and may even choose to accept lower profit margins or forgo profits entirely during the time may be rewarded with lifelong loyalty from their customer base.

Support of price controls is support of shortages, starvation, suffering, and death.

[whippoorwill]

There is no such thing as gouging.