The Economics of Price-Gouging

Summary


So it appears a Salem gas station might have committed the heinous offense of price-gouging back in 2008 and now will pay for it ("State sues Salem gas station in pricing case," Aug. 28 Roanoke Times). Pardon me if I don't feel all warm and fuzzy. I'd much rather the attorney general round up murderers and pedophiles than businessmen who try, perhaps too eagerly, to make a buck.

The story, as I understand it, was that as Hurricane Ike hit land and interrupted the gasoline supply chain, prices shot up. The Salem station raised prices for a short while to $5.34 a gallon, and sold the pricey stuff to about 260 customers. I haven't heard that any of them had guns to their head.

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The Economics of Price-Gouging

I don't remember if I bought gas in those few days last September, but I know I wouldn't have paid that much. It's not like there weren't other gas stations on Main Street, o...

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