Economist: No Sanitizer Because ‘Selfish People Demanding Price Be Held at $1’ Bought It All – Michigan Capitol Confidential

Economist: No Sanitizer Because ‘Selfish People Demanding Price Be Held at $1’ Bought It All – Michigan Capitol Confidential

• Under ‘price gouging’ bans, after the lucky first few, ‘everyone else gets nothing’

"An economist at a national economic think tank is using an actual 'price gouging' complaint filed with the Michigan Attorney General to illustrate why government-imposed price controls cause store shelves to empty more quickly than they would otherwise during an emergency.
The alleged price-gouging incident occurred on March 8 at noon in Dearborn, according to the Michigan Department of Attorney General.
The complaint read: “Everyone is afraid of the covid 19 coronavirus. There are no more hand sanitizer in large retailers and small stores. All stores were out of stock. However, the Dearborn fresh supermarket was selling an 8 oz hand sanitizer for a price of 10 dollars. This is clear price gouging during this panic. $1 hand sanitizer is now $10. They are causing consumers to panic. This is illegal and against the law. Please look into this matter as soon as possible. Truly inhumane and no regard for the people.”
But Antony Davies, the Milton Friedman Distinguished Fellow at the Foundation for Economic Education, said the complaint makes a bad argument for government-imposed price controls.
“A price is not a lever that one throws so as to alter reality,” Davies said in an email.
“A price is a metric that responds to a reality that already exists. The store does not cause people to panic by raising the price of hand sanitizer. The store raises the price of hand sanitizer in response to the fact that people are panicking.”...
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