Far too many Americans think their feelings trump economics. At no point does this become more clear than during a disaster when millions decry “price gouging.”
Plenty of articles explain the economic importance of sharply higher prices during a crisis, both in protecting supply, and enticing goods and services into the affected region. (For example HERE and HERE.)
But none of this matters when feelings come into play. People simply won’t listen to reason. They either want laws preventing price gouging, or think businesses should voluntarily refrain from hiking prices.
The problem is moral outrage does nothing to alleviate the most fundamental problem facing humanity – scarcity. There simply isn’t enough stuff for everybody. Prices and profits remain the best mechanism to allocate resources – even during a disaster. Feelings can’t change that.
