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I think the crux of their argument is "“Windfall” profits belong in the pantheon of saints along with price-gouging. In competitive industries, that’s what enco
by lesuorac 2y ago
I think the crux of their argument is "“Windfall” profits belong in the pantheon of saints along with price-gouging. In competitive industries, that’s what encourages people to enter and offer new supply.".
Which just isn't true. If you can only profit on toilet paper once every 100 years due to a pandemic who is going to build a new supply chain for it?
How many new oil refineries got built during the oil shocks?
How many new bottle water plants got build during Hurricane Katrina?
How many new [mh]otels got built after Woodstock II?
A short term shock (price gouging) doesn't cause new entrants.
- Graziano_M 2y agoYou don’t need new water bottle factories, you just need more companies willing to truck in their supply from farther out.
- EricE 2y agoIndeed. Excess profits will encourage extra sources of supply that otherwise would not materialize. Price gouging enables faster resolution of the situation that caused price gouging in the first place! It decreases overall misery; it doesn't increase it. To see that you have to be able to see the big picture and look beyond more than the immediate price; unfortunately most people can't think that systemically.
- lesuorac 2y agoPretty sure the systemic solution is either decrease the local population (evacuate) ahead of the well forecasted disaster or to increase the supply of the item (i.e. [mh]otel) ahead of the well forecasted Woodstock II instead of having the poor suffer.