With Hurricane Florence making landfall in the Eastern United States, the usual reports of the “evils” of the private sector price gouging the poor, desperate people in the disaster zone tend to crop up. The economic arguments as to why this claimed problem really isn’t a problem have been covered extensively. However, government laws on price gouging, and the public sector presence in disaster management in general, have additional effects beyond creating shortages of gasoline for first responders to engage in critical rescue operations. At its core, economics is really the study of human behavior, particularly focused on the motivations behind … Continue reading ‘Price Gouging’ Sends Important Signals