Average reading time (excluding links): 3m
I understand the economics of when the availability of a commodity decreases, and the demand for that commodity increase - or remains the same - that the price for that commodity will increase.
From
The Houston Chronicle:
On Monday afternoon, someone reported a Houston convenience store charged $20 per gallon of gas, according to Kayleigh Lovvorn, a spokeswoman for Attorney General Ken Paxton's office.
[.]
...price gouging can carry civil penalties of up to $20,000 per violation and up to $250,000 per violation for victims over 65 years old.
[.]
Other complaints include a Houston gas station charging $3.50 per gallon of fuel, $8.50 per water bottle and $99 for a case of water.
From
The Jeff Bezos Peoples' Republic (WaPoo):
At a Best Western location in Robstown [.] [a] crew from [KXAN station] booked a room and was charged $289.99 a night, according to KXAN. The total, $321.89 including taxes, is nearly three times the normal rate of $119 a night.
[.]
In Corpus Christi, a RaceWay gas station drew ire after a woman said she was charged more than $60 for two cases of beer [.] RaceWay told the station that the overpricing was caused by a clerical error, not price-gouging.
From
The Boston Globe:
Best Buy says it is ‘‘deeply sorry’’ following accusations of price gouging after a photo posted online showed cases of water for sale at one of the electronic retailer’s Houston-area stores for more than $42.
[.]
The company explained in a statement that it doesn’t have pricing for cases of water in its system and employees priced the water ‘‘by multiplying the cost of one bottle by the number of bottles in a case.’’
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| Image: BBC |
Maybe -
maybe - some of the price increases were made in error, or by an independent franchise with a
chain name (although "independent franchise" is such an oxymoron. How can the parent company disassociate itself from its "independent franchise" ?!?), or, as in the case of Best Buy, an employee calculating the cost by the number of bottles in the case.
I wish I could remember who and where, on my blog roll, I read what I read about Tim Worstall, but I've been reading a lot, at many sites, on all things related to Hurricane Harvey. And price gouging is nothing but despicable.
The short story
from the L.A. Times:
Conservative economist Tim Worstall posted a very provocative column on Forbes.com Sunday about the dire situation in Houston, arguing in favor of price-gouging.
[.]
It appears that Worstall’s column was too provocative for Forbes, which customarily has been a great advocate for the free market, as is Worstall. Mysteriously, the column disappeared from the Forbes website sometime Monday. It hasn’t been seen since. Anyone clicking on its original Web address gets an error message.
At
Tim Worstall.com, on his post titled
"There's an awful lot of people who don't get economics you know" [sic] - (Tim, you may want to familiarize yourself with
"The Comma",) - I found the below reply from Tim to someone else. The full comments and exchanges are at the link, what I blocked out was just something that was out of context and, by itself, didn't make sense:
"I'm entirely fine with public provision of these things...as also the bottled water. I'm arguing though against the making of private provision illegal. Should it be illegal for there to be security guards (private police) or private ambulances?"
Most of us, I think, can analyze that last sentence and, reasonably conclude, that as a moral matter of economics, one cannot compare the price increases in bottled water, beer (for whatever reason), hotel rooms, and gasoline to those of security guards/ private police or private ambulances. And I have never read or heard anything, ever, about trying to quash private businesses providing special services for premium fees to those who can pay for them.
In purely economic terms, is it price gouging when someone with the financial resources voluntarily contracts out for their own private ambulance service? And they are willing to pay that price rather than depend on the public service ambulance?
If a person with the financial resources contracts with a private security firm and they do it voluntarily, and they agree to a "premium fee" for those services, is that price gouging?
Worstall seems to fail in distinguishing price gouging and voluntarily paying premium fees for special services. Or is there something I'm completely not understand here?
