IS PRICE GOUGING BAD?


Independent Institute Research Fellow Art Carden on the economics behind price gouging.
DATE: 11/02/2012

Discussion Questions

1. What is “price gouging”?

2. Why do some people argue that price gouging is a bad thing? Why do others say that it’s a positive thing? What do you think?

3. Should companies be penalized or individuals thrown in jail for raising prices or selling “gouged” supplies? What, if anything, does this help protect against? Do you think it is a fair punishment? Why or why not?

4. What, if anything, gives suppliers incentive to send extra flashlights or generators, for example, to areas hit by hurricanes? Defend your answer.

5. Art Carden argues that prohibiting price gouging prevents companies from “bringing more supplies to the market.” What does he mean by this?


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