Thread · HN Continuity

Have the lockdowns and empty shelves that formerly held toilet paper really been that long ago? Artificially forcing sale prices to remain static when the underlying dynamic, which is to say the price, has changed creates economic dislocation and even suffering. Prices carry information and are not arbitrary.

Choose your emergency: paper products, bottled water after a hurricane, etc. Value is subjective; no item has an underlying True Intrinsic Price. When demand increases, the item becomes more valuable. The price should go up, at least in the short term. When held lower than the market price, runs occur and shelves empty. When allowed to rise, increased prices have a natural rationing effect to keep goods on the shelves for people who need them. Higher prices attract new providers, and the increased supply brings prices back down as circumstances return to normal.

Analyzed rationally, we see there’s no such thing as price gouging. The concept is an appeal to our base instincts.