When is price gouging not price gouging? Almost always, actually

Every long weekend in Australia (for example), accusations of price gouging fly as petrol prices increase. Increase, that is, in the face of an expanding demand curve right before everybody drives off to the coast for 3 days.

Price gouging, on the other hand, is – at best – suppliers jacking up prices for goods when/as they’re needed: e.g. in stated emergencies. Long weekend? Not an emergency.

The weekend’s post about the secondary market for Hannah Montana tickets? Not price gouging.

These aren’t non-economic abuses of the market. They’re abuses by the market itself – basic economic principles. When a commodity’s yield goes through the roof and we suddenly get cheap milk, bread, coffee, oil, sugar, do we, as consumers, feel bad for our low prices? Of course not.

And to the Yankees. Or rather, bloody politicians. Via Streetsblog:

Councilmember Monserrate decided to introduce the bill after he joined with friends to attend Sunday’s post season baseball game between the NY Yankees and the Cleveland Indians. He observed a dramatic increase in parking fees around Yankee stadium to $50 and even attempts to charge up to $150 by unscrupulous operators.

“As a Met Fan from Queens, I decided to attend [read: drive to] last Sunday’s game and show some support our other New York Team, the NY Yankees. I observed several lots with Parking Lot Full signs, all operated by Central Parking Company. They were advertising a $50.00 fee to park. Shockingly, and to add insult to injury one particular lot, (also operated by Central) had a “FULL” sign in front but the attendants told me if I paid $150.00 they would park my car,” Monserrate said.

A) If the sign says FULL, that may, for example, not include a parking spot that the employee gets for themselves (maybe they can sell it, maybe not: it’s not our problem, surely, as a local government). One wonders, also, whether he’d care if the guy had recognised him and offered him the space for free.

B) If not, that is a form of corruption only as defined by (well, besides a normal person) the charter of the private company – it is not the same as charging $50 legitimately.

C) First-year bloody students can tell me what will happen when supply is fixed and the demand curve shifts outwards: the bloody price will go up. Quickly.

It is not price-gouging. It is not “unfair”. It is the way markets work. It’s what makes America great! As Streetsblog’s writer points out,

So, to Monserrate, being asked to pay market rates for auto storage at a sporting event that is accessible by transit qualifies as an “insult.”

Their gripe, of course, being more related to the fact that this tit wants government regulation to further incentivise people to drive to an event that already does not have enough fucking parking spaces.

Politicians, man. Do they start this stupid and underqualified, or does it develop over a brain-atrophying term or two in office?


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