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It also means poor people can’t get water or basic food, rich people can. Many people are not OK with that, so instead we have shortages and the early bird gets

It also means poor people can’t get water or basic food, rich people can. Many people are not OK with that, so instead we have shortages and the early bird gets the worm (but no relation to ability to pay)

missedthecue 6y ago
It really means that rich people subsidize poorer people by buying at high prices which encourages new supply. Remember: The alternative isn't that poor people get supplies, the alternative is that very few people get supplies.
- cortesoft 6y ago
  Like the previous commenter said, this only makes sense in normal times... in a temporary emergency, there is no time for anyone to ramp up production, so high prices don't last long enough to drive production. Of course, whether this situation is an emergency of that sort or not is up for debate.
  - ggreer 6y ago
    Yes, manufacturing does take time to ramp up, but higher prices mean that people use that good more efficiently, try to find substitutes, and try to import more from elsewhere. Also if there was a norm of not having price limits during emergencies, companies (and scrappy entrepreneurs) would have an incentive to stockpile goods in times of plenty so they could sell them at a large markup in a crisis.
    - veggieburglar 6y ago
      You might also say they could have an incentive to manufacture a crisis in order to attain said large markup.
    - sokoloff 6y ago
      Perhaps even more importantly, regular people would have incentive to have some sensible amount of supplies on hand on a regular basis, providing some decoupling capacitance in the system. We normally have some stock in the pantry but really stocked up around the 3rd week of Feb. Exiting this, we are likely to keep a deeper supply of certain shelf-stable items on hand, to reduce the risk of inconvenience next time. If we had strong price signals to support that behavior, I think there’s power in the whole public doing that.
- 8note 6y ago
  The manufacturer benefits from selling at higher volume, not the temporary spike in price though. The rich people's money is going to arbitrage, not being invested into making more supply

missedthecue 6y ago

It really means that rich people subsidize poorer people by buying at high prices which encourages new supply. Remember: The alternative isn't that poor people get supplies, the alternative is that very few people get supplies.

cortesoft 6y ago
Like the previous commenter said, this only makes sense in normal times... in a temporary emergency, there is no time for anyone to ramp up production, so high prices don't last long enough to drive production. Of course, whether this situation is an emergency of that sort or not is up for debate.
- ggreer 6y ago
  Yes, manufacturing does take time to ramp up, but higher prices mean that people use that good more efficiently, try to find substitutes, and try to import more from elsewhere. Also if there was a norm of not having price limits during emergencies, companies (and scrappy entrepreneurs) would have an incentive to stockpile goods in times of plenty so they could sell them at a large markup in a crisis.
  - veggieburglar 6y ago
    You might also say they could have an incentive to manufacture a crisis in order to attain said large markup.
  - sokoloff 6y ago
    Perhaps even more importantly, regular people would have incentive to have some sensible amount of supplies on hand on a regular basis, providing some decoupling capacitance in the system. We normally have some stock in the pantry but really stocked up around the 3rd week of Feb. Exiting this, we are likely to keep a deeper supply of certain shelf-stable items on hand, to reduce the risk of inconvenience next time. If we had strong price signals to support that behavior, I think there’s power in the whole public doing that.
8note 6y ago
The manufacturer benefits from selling at higher volume, not the temporary spike in price though. The rich people's money is going to arbitrage, not being invested into making more supply