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If you want to be "fair" for a necessity such as gasoline, you can have tradable rationing coupons. That way you are rewarded if you buy and use less gasoline,

If you want to be "fair" for a necessity such as gasoline, you can have tradable rationing coupons. That way you are rewarded if you buy and use less gasoline, but the excess windfall due to the shortage is still transfered to you and away from the supplier. But even this assumes that gasoline is in fixed supply and there is no way of increasing its total production by paying more, which is not a very good assumption.

franga2000 11mo ago
In a time of shortage, throwing more money at the problem usually won't increase supply. A shortage necessarily means that if you make more of something, you're guaranteed to sell it basically instantly, so there's already an incentive to increase production. And it's not like the higher prices mean more money goes to the producers so they can invest in more production capacity. The price increase is spread out between every middleman in the chain untils there's almost nothing left. This could work only if the producers themselves are the ones raising prices, but then everyone else would still add their own cut, leading to even crazier price hikes, and also it's unlikely that extra profit would go to much more than lining the owners' pockets. Additionally, demand spikes usually don't last, so any new production capacity you build will be a liability later, after the market settles down.
- kortilla 11mo ago
  >A shortage necessarily means that if you make more of something, you're guaranteed to sell it basically instantly, so there's already an incentive to increase production. This is patently false. Every oil reserve around the world has a cost per barrel of extraction. At $60/barrel many of them are shut down. If you fix the price at $60 and demand goes up, you’ll end up with shortages and producers won’t be able to fill the gap. It is very rare to have a market of physical goods where the cost of production is fixed and supply is effectively limited. For every other market, the price needs to go up to entice investing in making more supply.

franga2000 11mo ago

In a time of shortage, throwing more money at the problem usually won't increase supply. A shortage necessarily means that if you make more of something, you're guaranteed to sell it basically instantly, so there's already an incentive to increase production. And it's not like the higher prices mean more money goes to the producers so they can invest in more production capacity. The price increase is spread out between every middleman in the chain untils there's almost nothing left. This could work only if the producers themselves are the ones raising prices, but then everyone else would still add their own cut, leading to even crazier price hikes, and also it's unlikely that extra profit would go to much more than lining the owners' pockets. Additionally, demand spikes usually don't last, so any new production capacity you build will be a liability later, after the market settles down.

kortilla 11mo ago
>A shortage necessarily means that if you make more of something, you're guaranteed to sell it basically instantly, so there's already an incentive to increase production. This is patently false. Every oil reserve around the world has a cost per barrel of extraction. At $60/barrel many of them are shut down. If you fix the price at $60 and demand goes up, you’ll end up with shortages and producers won’t be able to fill the gap. It is very rare to have a market of physical goods where the cost of production is fixed and supply is effectively limited. For every other market, the price needs to go up to entice investing in making more supply.