Why Is Price Gouging Wrong

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Key Concepts
Price gouging, moral wrongs, Anti-gouging legislation, equitable access, Non-worseness claim
Key Arguments In case of a disaster a gouging situation is characterized by its monumental significance to both the vendor and the customer. In fact, the exchange of critical goods in the event of a gouging situation, results into considerably greater utility to the customer as compared to the vendor. The temporary increase in prices during disasters can be attributed to the dynamics of the rule of the market. While disasters can significantly deplete essential supplies, they usually create increased demand for essential commodities. Naturally, this leads to increased prices of essential commodities, which have inelastic demand without
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If the non worseness claim is true, then standard cases of price gouging cannot be considered serious moral wrongs.
The assertion that price gouging undermines equitable access to essential commodities has serious flaws. Zwolinski argues that it is the emergency state that undermines the equitable access and not the ridiculous increase in prices that may come as a result of a disaster (Zwolinski 2009). Emergencies trigger either drastic increase in demand or sharp decline in supply of essential commodities, which subsequently undermines equitable access.
Price gouging occurs during an extremely short duration mainly because sudden increase in prices during crises attract more suppliers of vital commodities. The increase in supply consequently drives the prices down to something close to the pre-disaster equilibrium.
Points of Agreement and
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Price gouging refers to instances when sellers set commodities’ prices at rates that are considered unfair, exploitative and even unethical. However, despite facilitating for unprecedented profits for businessmen, price gouging has numerous benefits. Besides striving to make additional profits in the event of a disaster, businesses have a social responsibility to ensure that victims gain access to essential commodities. Whereas charging extremely high prices to victims of disasters can be viewed as being morally unethical, businesses ought to be applauded for taking the initiative to serve consumers. One of the most significant contributions of price gouging is the fact that it symbolizes a drastic reduction in supplies. Consequently, more suppliers gain the incentive to avail more products in the market. Consequently, this plays a pivotal role in driving prices down to rates closer to those that existed prior to the onset of

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