Michael Munger Says ‘Price Gouging’ Gives Us Information We Need

AS THE COVID-19 pandemic prompted shoppers to clear supermarkets of toilet paper, rice, and canned vegetables, Matt and Noah Colvin loaded up a U-Haul with all the hand sanitizer and antibacterial wipes they could find, then attempted to resell the goods on Amazon at a massive markup. Soon after, the online retailing giant banned the practice, state attorneys general started cracking down, and the Colvins were shamed into donating the items.

But is so-called price gouging’s Nick Gillespie spoke via Zoom with Michael C. Munger, who teaches economics, political science, and public policy at Duke University, about what happens when governments mandate that the prices of scarce goods be kept down. Munger says such laws end up causing more shortages than they solve, especially during a crisis.