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From the article: "Price gouging is generally defined as a situation where companies set the price above the customary level in order to prevent shortages from
by graybeardhacker 2y ago
From the article:
"Price gouging is generally defined as a situation where companies set the price above the customary level in order to prevent shortages from occurring."
This is not the definition as far as I know.
- AnimalMuppet 2y agoThat sounds like normal supply and demand, not "price gouging". If you only have N of something, you set the price level such that the demand at that price will only be N of that thing. But people feel it as price gouging. If the price has been X for a long time, and now the price is suddenly several times X because the supply got short, that feels like price gouging rather than "supply and demand".
- beardyw 2y agoI think it is perceived as a reasonable profit vs an unreasonable profit.
- AnimalMuppet 2y agoWell, but see, supply and demand works on both ends. That is, I'm selling the thing that's in short supply. But why is it in short supply? Because if I'm the manufacturer, I can't make any more of them than I'm making. And if I'm the distributor, I can't sell any more than I can buy from the manufacturer. And why can't the manufacturer make any more? Typically, because there's some resource that they can't get. So they get some more, but they get it by paying more for it. So the point is, when the company selling you the widget raises their price, that isn't pure profit. Their costs went up too, because the price of what they need went up.