At 10:55 AM 10/5/2000, Marcel Popescu wrote:
>There's no person called "market", therefore it has no "interest". It's a
>decision of the current resource owners - and when demand increases (as in
>the case of a major disaster), they *have to* increase their prices until
>the supply is equal to the demand (if they don't, the first buyers will sell
>what they bought on the "black market" to those who value it more). Basic
>economics, even US public schools must teach that much.
>
>The stores might have been "depleted", but the high prices would have made
>it profitable to sell food there, and someone would have done that.
>Furthermore, the expectation of high prices due to an impeding disaster
>would have created incentives for "hoarding" - that is, gathering as many
>resources as possible, which would have attracted imports BEFORE the
>disaster. Price fixing destroys any incentive for spending now in order to
>profit later.
The public schools do teach this much, but it's an elective. I didn't like
Vo. Ag.
Yes, if you ONLY restrict inflation, those who come first can purchase your
full stock and resell it to a higher bidder later. Simple supply and
demand. From my perspective, this would only work if the government also
limited the buyers to a set amount, and then included some element to
restrict someone from hitting several stores for the same quota. The three
methods I can see to do the latter are, stiff penalties for buying more
than allowed, ration tickets, and both.
Did the government have such limits in place?
Good luck,
Sean
