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Price Gouging and the COVID-19 Crisis – This Time Is (a Little) Different

BY | September 22, 2020

Shortages resulting from natural disasters invariably lead to allegations of price gouging. By themselves, price gouging laws exacerbate rather than alleviate shortages by preventing the price mechanism from discouraging hoarding…

Shortages resulting from natural disasters invariably lead to allegations of price gouging. By themselves, price gouging laws exacerbate rather than alleviate shortages by preventing the price mechanism from discouraging hoarding and encouraging supply expansion. To retain customer loyalty, some businesses may limit their price increases and instead either impose their own rationing or accept stock-outs. Those private decisions do not justify legal sanctions against companies that do not exercis

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