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$5000 per violation of price-gouging in CA

caloes.ca.gov

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Re: $5000 per violation of price-gouging in CA

#71

Post by frankharv »

blhack wrote: post #22
wayoutthere wrote: post #12

Earlier quoted context omitted.

So low wage workers should abandon their jobs to spend their time procuring essentials at reasonable prices? Because right now there's a lot of speculation short-term, but things will go back to normal in a week or so after everyone has enough toilet paper to last until 2050. Free market capitalism frequently generates outcomes that are at odds with a functioning society, and this is just another example.

What makes you think things will go back to normal in a week or so?

[flagged]

Re: $5000 per violation of price-gouging in CA

#72

Post by whatshisface »

AsyncAwait wrote: post #42
nwah1 wrote: post #23

Earlier quoted context omitted.

Yep. A much better way to alleviate shortages would be to suspend sales taxes.

Yep, here's that comment. Business benefit over direct customer benefit seems to be the manta these days.

I'm not sure how the parent thinks it will help with shortages, but sales tax adds to the price that the consumer pays. On sales tax holidays you see prices go down.

Re: $5000 per violation of price-gouging in CA

#73

Post by jka »

whatshisface wrote: post #4

Price isn't just the cost of buying something, it's the reward for producing it. If we see too many price gouging laws, then you can expect shortages as companies find themselves unable to justify extreme measures that would otherwise increase production (at great expense). Secondly, I would expect that localities with price gouging laws will discover that their goods are being re-routed to other places without those…

Here is a link to the relevant section of the California penal code:

https://leginfo.legislature.ca.gov/faces/codes_displaySectio...

"While the pricing of consumer goods and services is generally best left to the marketplace under ordinary conditions, when a declared state of emergency or local emergency results in abnormal disruptions of the market, the public interest requires that excessive and unjustified increases in the prices of essential consumer goods and services be prohibited."

Emphasis mine. This definition still allows producers to pass on increased costs, as long as they are not excessive and unjustified.

Re: $5000 per violation of price-gouging in CA

#74

Post by nostrademons »

logicchains wrote: post #52
nostrademons wrote: post #35

Earlier quoted context omitted.

From a political standpoint, I see the point. Price gouging makes people extremely mad, and it redirects goods from poor people to wealthy people. When tempers are already fraying and maintaining social order is already difficult because of an emergency, the last thing a government needs is a nucleus for lots of pissed-off people to rally around. Remember that the first priority of any government is to keep itself in…

>it redirects goods from poor people to wealthy people. In this case it's arguably something desirable, as the most at-risk group, the elderly, on average are much wealthier than young people. Someone over 80 is around 100x more likely to die from the virus than somebody under 40.

Think in terms of the survival of the government, not in terms of general social welfare. If you have a lot of pissed off poor young people, they're often fairly socially well-connected, they're more aggressive, they're able-bodied, and they can fight. If you have a lot of pissed off old people, they'll continue to be pissed off but probably won't make a whole lot of trouble. They might make a lot of trouble come election day, but in an emergency the priority is the survival of the government now, so that you can get to the next election.

This is not an academic thought exercise, BTW - a lot of the social unrest of 2019 in Venezuela, Chile, Hong Kong, Zimbabwe, Iraq, etc. came from prices rising quickly enough that young people could not afford basic necessities.

Re: $5000 per violation of price-gouging in CA

#75

Post by frankharv »

seibelj wrote: post #48
krapp wrote: post #38

Earlier quoted context omitted.

The reason the water is clean and the food is nutritious is due to regulations, not free market capitalism.

Free market capitalism is not in opposition to regulations. America is a free market. We don’t live in socialism.

Regulation for safety concerns is not price control.

Re: $5000 per violation of price-gouging in CA

#76

Post by ghshephard »

radu_floricica wrote: post #47

Prices being elastic is good for people, in a vast majority of cases. It makes sure things get distributed more or less proportional to need, as opposed to just random or worse than random. Case in point: I luckily found some hand gel still for sale online. Probably the very last one around here. So I stocked up - not resale quantities (thought it would have been trivial) but definitely more than I needed - something…

"I'm doubtful I'll get to see any more this year." - I'll take that action. All of the consumable that people have been panic buying - toilet paper, hand gel, etc... have experienced absolutely zero supply shock, and, indeed, most of the manufacturers are going to be delighted to draw down their inventory and get a boost this quarter. I'll be extraordinarily surprised if shelves aren't completely full of those consumable within 7-10 days.

People are strange - the fact that there was a global pandemic coming at us was pretty obvious as of early march, but it was this weekend that everyone decided to panic? It's not as though this were a hurricane that just landed on us by surprise.

I fully support the price gouging laws - it discourages these yahoo's from buying up all of the supplies and sticking it in their garage and depriving people over the weekend who might need a container.

Re: $5000 per violation of price-gouging in CA

#78

Post by bouk »

radu_floricica wrote: post #47

Prices being elastic is good for people, in a vast majority of cases. It makes sure things get distributed more or less proportional to need, as opposed to just random or worse than random. Case in point: I luckily found some hand gel still for sale online. Probably the very last one around here. So I stocked up - not resale quantities (thought it would have been trivial) but definitely more than I needed - something…

You're justifying your own unethical behavior by painting yourself as a rational economic agent, when you could also just not buy more than necessary and leave some for other people.

Re: $5000 per violation of price-gouging in CA

#80

Post by jseliger »

whatshisface wrote: post #4

Price isn't just the cost of buying something, it's the reward for producing it. If we see too many price gouging laws, then you can expect shortages as companies find themselves unable to justify extreme measures that would otherwise increase production (at great expense). Secondly, I would expect that localities with price gouging laws will discover that their goods are being re-routed to other places without those…

Yes. These laws are bad. Mike Munger of Duke University explains more here: https://www.econtalk.org/munger-on-price-gouging/
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