In the aftermath of Hurricane Harvey, which made its initial landfall on the Texas Gulf Coast in late August, many are questioning whether price-gougers acted morally when ratcheting up the prices of their goods. The same sentiment is being heard with Hurricane Irma, now tearing through Florida and the Southeast. Acton affiliate scholar Victor Claar, who teaches economics at Florida Gulf Coast University in Fort Myers, points out in a Detroit News opinion piece that when prices spike, they “serve a rationing function: When any good or service is in short supply, not everyone will be able to get it. You may choose to deny this claim, but you cannot render it false.”
Michigan residents didn’t get this message when Attorney General Bill Schuette vowed not to let the state’s gas stations and distributors get away with price-gouging in the wake of Hurricane Harvey. Schuette, Claar wrote, “was simply using the human tragedy in Texas as a platform for his own political self-promotion.” That doesn’t mean there weren’t supply disruptions of gasoline related to Harvey. But, Claar added, “Schuette is probably just employing the recent outcry against gougers as a way to remind Michiganians who he is and that he is relevant.”
Read Claar’s full article here.