I disagree with that being “the main question” because:
High prices simultaneously increase quantity supplied and reduce quantity demanded. The OP is foregrounding the supply effect but your comment is purely focused on the demand effect.
It’s possible for willingness-to-pay to correlate poorly with need, but for ability-to-procure-underpriced-items-during-a-shortage to correlate even more poorly with need. For example, the latter might involve having time to wait on line, or savvy ability to know where supplies will open up next, or even worse, being friends with the shop owner, being the police chief, etc.
If a shop charged a high price AND had a cap on how many items can be bought by any given buyer, people would still be about equally angry about the price gouging.
Right, when I said “the main question”, I meant the main question for the local allocation only, in response to “it’s not clear that these allocations are more egalitarian”.
Evidence from wartime rationing is that given a per-buyer cap, people are less angry about price rises. Or perhaps war creates more solidarity than natural disasters.
Maybe a compromise is possible where merchants are allowed to raise the price provided that they have a per-buyer cap and sell their stock quickly.
I disagree with that being “the main question” because:
High prices simultaneously increase quantity supplied and reduce quantity demanded. The OP is foregrounding the supply effect but your comment is purely focused on the demand effect.
It’s possible for willingness-to-pay to correlate poorly with need, but for ability-to-procure-underpriced-items-during-a-shortage to correlate even more poorly with need. For example, the latter might involve having time to wait on line, or savvy ability to know where supplies will open up next, or even worse, being friends with the shop owner, being the police chief, etc.
If a shop charged a high price AND had a cap on how many items can be bought by any given buyer, people would still be about equally angry about the price gouging.
Right, when I said “the main question”, I meant the main question for the local allocation only, in response to “it’s not clear that these allocations are more egalitarian”.
Evidence from wartime rationing is that given a per-buyer cap, people are less angry about price rises. Or perhaps war creates more solidarity than natural disasters.
Maybe a compromise is possible where merchants are allowed to raise the price provided that they have a per-buyer cap and sell their stock quickly.