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Nov10-05, 04:44 PM
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Quote Quote by russ_watters
As I rather suspected, "price gouging" really doesn't have any meaning in a market economy. Sellers are by definition allowed to sell their products for whatever price they can get. Charges of "price gouging" are an emotional response to an adverse market condition.
Actually the term would be "market manipulation". The front end supply and refineries were affected - but the likely culprits to higher prices are the commodities traders who bid up the prices, and maintain high prices to cover their investments. Charges of "price gouging" are legitimate, and various state Attorneys General are looking into reports of gouging. Keep in mind, the dealers had already purchased the gasoline they were selling, and they raised the prices arbitrarily.

Yes people panicked and hoarded, and bought more gasoline than normal. For many, gasoline is more or less a necessity - either one buys gas or one does not get to work. Now, in an emergency, people could have elected to 'carpool', assuming a person has made prior arrangements with a friend or colleague, or people could have used public transportation. But then one surrenders the freedom to come and go as one pleases.

Quote Quote by russ_watters
Don't forget, this isn't like when OPEC cuts production to raise prices. That's collusion that makes OPEC a cartel, and if OPEC were made of American companies, it'd be illegal. But Katrina did create a real change in the oil supply. Gas stations did run out of gas and people did hoard it.
A temporary and minor change in oil supply. Gas stations ran out of gas because the demand exceeded supply.

But, some of those gas stations who did not run out of gas, and who had ample supply, did raise prices - when there was no shortage.