The State of NJ charges mercants with gouging for $5.50 gas after Sandy

[Charles Kozierok]

*If* and it's a big *if* we pretend that you have established that higher prices would have lead to increased supply, sooner (how much sooner? An hour?), you still haven't proven that this is a 'best outcome'.

"Best outcome" is a subjective assessment. My claim was that allowing prices to float increases supply -- and it does.

Not everyone will consider this a "best outcome". But many will, including those who actually need the items in short supply the most.

You claimed to have objections to that principle, but haven't outlined what they are. So, no, so far it is not a "big if". It's well-established market behavior.

Your assumptions of voluntary behavior, and others your model requires are certainly in doubt in crisis situations.

Sorry, I don't know what you are talking about here.

Again, if you want to make an argument that price controls do not increase supply during shortages, please do so. You haven't yet.

 

[3chordcharlie]

"Best outcome" is a subjective assessment. My claim was that allowing prices to float increases supply -- and it does.

Not everyone will consider this a "best outcome". But many will, including those who actually need the items in short supply the most.

You claimed to have objections to that principle, but haven't outlined what they are. So, no, so far it is not a "big if". It's well-established market behavior.

The strongest statement to be made is that floating prices weakly increases supply (i.e. it definitely does not decrease supply). Whether there is an actual increase in supply depends on what, specifically is causing the shortage.

Looking back to your original response, you actually made one of the weaker claims about the benefits of allowing unlimited price floating (weaker as in easier to support).

Sorry, I don't know what you are talking about here.

Again, if you want to make an argument that price controls do not increase supply during shortages, please do so. You haven't yet.

Looking back to your original response, you actually made one of the weaker claims about the benefits of allowing unlimited price floating (weaker as in easier to support). In many, if not most cases, it is infrastructure repair that will hasten supply increases, not price. What happens in the middle has more to do with profiteering than anything else.

Conflating price and need, particularly in a crisis situation is pretty far-fetched. This is why understanding the assumptions that make a market model work is important; you need to understand the limitations of a model in order to apply it.