"Only high prices are an incentive for new producers to enter a market." Price gouging is taking advantage of spikes in demand that happen much faster than pro

"Only high prices are an incentive for new producers to enter a market." Price gouging is taking advantage of spikes in demand that happen much faster than production can adjust. This is the difference between short-run/long-run economics. There are tons of products that had a little blip for which production isn't going to adjust. The surpluses gained by gouging are usually far outweighed by the loss of trust in the relationships, which is why big companies with longer horizons tend not to do it. Almost every large retailer right now could be jacking up prices on a lot of things. They don't though. Prices for toilet paper etc. have largely remained the same.