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Hotels fall into a class of businesses that are considered a public good, much like taxi companies. As such, there are often really strict regulations on what h
by URSpider94 6y ago
Hotels fall into a class of businesses that are considered a public good, much like taxi companies. As such, there are often really strict regulations on what hotels can charge customers. Some of it is to prevent racist practices, but some of it is to prevent straight-up profiteering in emergency situations.
As others have noted, most states require that hotels post their maximum rates on cards inside the room for this very reason. I’m not sure, but I expect that the hotel’s business tax may be based on those maximum room rates. There must be some incentive not to just make those max rates “one meeeeelion dollars”.
The unwritten rule is that we expect hotels to be there in times of crisis to house the population. There are also a ton of regulations around things like keeping an up-to-date guest register, providing a phone in every room, and providing a hotel safe. This is part of the reason that hoteliers get so upset at Airbnb - they aren’t subject to any of the regulations that hotels are, which helps them undercut their pricing, and which also leaves their patrons open to abuse.
- perl4ever 6y ago>Hotels fall into a class of businesses that are considered a public good This doesn't seem to be the term "public good" as used in economics, so what do you mean by it?
- URSpider94 6y agoYou’re right, that’s probably not the right term. What I mean is that hotels are considered a quasi public utility, in the same way as taxi services - private businesses that are essential to proper functioning of a community and as such are heavily regulated. And in part for this exact reason - when there are emergencies, we expect them to be available for people to use as temporary housing without being charged “surge pricing” - and that’s written into the law in most states.