What is price gouging and how is it different from typical inflation, dynamic pricing, or the economics of supply and demand?
In: Economics
It usually has to do specifically with prices of necessities, during time of crisis… like if there’s a hurricane and stores jack up prices of gas and bottled water to 5x the usual price because they know people are desperate to fuel up to flee, need to stockpile water in case there are water shutoffs/lack of drinking water. It doesn’t relate to non-necessities and to spikes due to intrinsic demand, etc. like if a store jacks up the price for the hot limited edition Jordan shoes.
It’s an immediate jump in price due to a specific event/predicted event, while inflation is more gradual and not tied to a single specific event. Inflation is typically a more broad experience vs. on a few specific products. In some ways it is dynamic price, just predatory in its amount of increase. It also may be tied to supply & demand, but in such short term that it’s harmful to consumers and extracts undue profits for seller (wholesaler, etc. didn’t benefit)
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