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Hurricane Heist?

9/15/2017

35 Comments

 
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by David Hagenbuch, founder of Mindful Marketing & author of Honorable Influence

As Hurricane Irma turned toward Florida, an angry consumer shared a screen shot of a 24-pack of 16.9 ounce bottled water that Best Source Office Supplies was selling on Amazon for $99.99.  Inflating the prices of necessities ahead of an impending natural disaster is a tactic that most people find deplorable, but not everyone.  Of course, companies taking that tack rationalize their actions, but certain others also make a compelling case for such price hikes.
 
Price gouging is "the practice of raising prices on certain types of goods and services to an unfair level, especially during a state of emergency."  Although it’s not uncommon for companies to increase prices on goods and services to levels that consumers think are too high, price gouging is different.

Consumers are price gouged when the item in question is something they must have (e.g., food, water), but the product’s supply is severely restricted, often to a single seller, so consumers have no choice but to pay the exorbitant price.  In contrast, although the new iPhone X starts at a staggering $999, Apple is not guilty of price gouging because it’s possible to survive without the newest iPhone.

In the case of Hurricane Irma, certain sellers reportedly gouged consumers for water, ice, food, and fuel.  One Orlando Shell station supposedly sold regular grade gas for $5.99/gallon and premium for $6.99.  Even Disney got into the act:  A Twitter user posted pictures from Disney’s Art of Animation Resort, which offered small bottles of water for $2 and juice boxes for $2.69 each.  A Disney spokesperson later said that the situation was an isolated incident that had been rectified.

To document such abuse, Florida’s attorney general Pam Bondi set up a hotline that received over 8,000 calls about price gouging, which violates Florida law and is subject to “civil penalties of $1,000 for each violation, and up to $25,000 for several violations within a 24-hour period.”  Beyond the legal penalties, Bondi promised violators personal retribution: “I will be saying your name all over national television and telling people not to go to your business ever again if you’re stealing from Floridians and taking advantage of Floridians in a time of need.”
 
Despite the fact that certain states have made price gouging illegal and most people consider it immoral, some claim that capping prices actually makes situations, like those surrounding hurricanes, worse.  Writing for Forbes, Adam Millsap argues that pricing gouging laws are what empty store shelves, not natural disasters.  The best thing, Millsap contends, is to let supply and demand determine prices like they normally do.
 
Similarly, in a New York Times article, Andrew Ross Sorkin states that “several respected economists from the Milton Friedman school of free-market theory” support the argument against price gouging laws because artificially low prices “remove the incentive for consumers to conserve essential supplies,” and they discourage sellers from increasing stock.
 
So, maybe Adam Smith’s “invisible hand” is the best way to determine supply when natural disasters strike.  That belief aligns well with an increasingly popular pricing strategy, dynamic pricing, in which firms like airlines use  algorithms to quickly increase prices to whatever level the market will bear.  Unfortunately, such approaches also tend to have some very undesirable side effects.
 
For one thing, higher prices naturally favor the wealthy.  That advantage is understandable under normal circumstances:  People with more money should be able to buy higher-priced items.  In the case of natural disasters, however, it doesn’t seem right to price anyone out of the market for food, water, or other basic survival needs.
 
Also, there’s no reason retailers can’t impose limits on how much or how many of an item customers can buy.  Stores successfully ration items all the time.  For instance, a grocery store runs a sale on granola and dictates: “Limit, two boxes per customer.”  Likewise, arguments against price gouging laws don’t give people much credit.  When asked to conserve, most individuals will limit their consumption for the sake of others.
 
In addition, the notion that businesses should maximize profits at their customers’ expense is both antiquated and short-sighted.  Sure, people may have no choice but to pay ridiculously high prices when they’re put between a rock and a hard place, but they won’t soon forget what it felt like to be treated as a means to an end.  Firms that price gouge run a great risk of alienating consumers and ruining their reputations.
 
On the other hand, companies that show restraint and price “to create shared value,” generate considerable goodwill, especially in the face of a natural disaster.  A few firms that bolstered their brands by taking this more enlightened and socially responsible approach when Irma struck were JetBlue, Airbnb, AT&T Wireless, and Martin’s Famous Pastry Shoppe.
 
It’s hard for most people to know how they will react in the face of life-threatening natural disasters like hurricanes Harvey and Irma.  Businesses, however, should know not to take advantage of people in such vulnerable states.  Companies that do are guilty of various offenses, and one of them is “Mindless Marketing.”


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35 Comments
Josh Hayner link
9/17/2017 05:24:29 pm

I think this whole price gouging deal going on during hurricane Harvey and Irma is one to be ashamed of, especially if you were the person who raised your basic goods like water and food to these ridiculous prices. I think that if you did these things there should be severe punishment for this because people in Florida are worried about surviving the hurricane and if people who live in their own state wont even help them then really who can they trust. In my opinion it might be one of the dumbest moves to make as a company because if your raising the price of your gas to $5.99/gallon then why in the world would anyone in their right mind ever buy any more gas at your stations after this hurricane is over. I actually think its fair to say that these companies are criminals, since they’re denying people the basic right to buy what they need like water for an affordable price during a crisis like hurricane Irma.
The only people who are going to be able to pay these prices are the rich people. The poor people are not going to be able to afford these things and it could cost them big time especially if they cant get food and water. I don't think businesses should be taking advantage of people especially when they’re in vulnerable states like during the time of these hurricanes. This is truly a mindless marketing plan. There is even over 10,000 complaints of price gouging in Florida which is massive and rightfully so. Price gouging during emergencies like the impending Hurricane Irma are illegal. This can even lead up to fines of $1,000 per offense and $25,000 if there are multiple offenses in a 24 hour period. This isn't just disgraceful in human eyes either but especially in God’s eyes, “Whoever oppresses a poor man insults his Maker, but he who is generous to the needy honors him.” (Proverbs 14:31) Price gouging is truly mindless marketing to me.

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David
9/19/2017 09:50:35 pm

Price gouging is something that is, in my opinion, a despicable act. After some quick online research I discovered that the price gouging claims were valid. Some online sellers, like the seller on Amazon.com, were most definitely raising the price of their products to ridiculous levels. Other online stores like Staples sold their goods for much less, $9.99. I’m not sure how crucial online water bottle sales will be for the community, are there not enough supplies in physical locations for people? Price gouging has been alleged for certain airline flights like Delta, but has so far proven to be false. In the case of the water bottle gouging, I find it quite reprehensible that a company would sink to such depths. The argument is made that the free hand of the market should be allowed to take its course and that we should allow the laws of supply and demand to work to reach an equilibrium. However, I firmly believe that tradition economics does not, and should not, apply to cases of emergency. In fact it is inhumane to allow the free hand of the market to take its course in this instance. These goods should be sold at normal, or even reduced price. The issue here should focus on the need of the community. Instead of using price to restrict sales, which favors the wealthy and excludes the poor, businesses should ration out supplies. Rationing allows for a more equal distribution of goods. Gouging prices is not beneficial for the companies which commit the act. It reduces trust and customer loyalty. It tarnishes the brand name. It hurts chances of further market growth in the area. People are defined by what they do in times of trial, and price gouging reveals a desperate, inhumane, way of conducting business. This is mindless marketing.

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Andrew Post
9/20/2017 12:14:42 pm

I think there is a difference between price gouging and raising prices to maintain equality. If prices are only raised a small amount , say 10%-15%, those with access to greater funds would be kept for wiping out a stores entire stock of whatever item they are looking for in the event of an emergency. Though this increase of price would potentially hurt those individual who do not have access to large sums of money, it may mean that there will still be a stock of what ever emergency supply they need when they get to the store. This would be a much more mindful approach for companies to take in the event of an emergency. If companies just raise their prices to the point that only the rich will be able to pay for them they end up hurting many more people than they are helping.

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Sunny Gelnovatch
9/20/2017 01:26:40 pm

I think price gouging is wrong. It is not right to raise the price of goods that are an necessity to the people in Florida who are being affected by Hurricane Irma. To raise the price of a 24 pack of a 16.9 once water bottles to $99.99 is absurd. Doing this allows only the wealthy to buy these necessities.

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Kevin Lyle
9/20/2017 03:08:13 pm

Price gouging is a despicable act. When preparing for unexpected natural disasters, many people are already spending money to get out of the storm's path. Nobody expects to find simple everyday items at sky-high prices. Furthermore, I feel that all states should have price gouging laws in effect. In fact, I think Florida should have more that jut monetary punishment. The prices set during storms should be considered petty thief as to allow a week or so of jail time.

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Christian D'Andre
9/20/2017 03:18:47 pm

I am in complete agreement that this is an outrage, especially in a time of dire need. This article is well-written, and well explained. Upping the price of water seems so despicable to actually go through with doing, but lo and behold! someone did it! how disappointing in the human race.

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Allie Sipes
9/20/2017 04:21:42 pm

I completely agree that price gouging is outrageous. It is bad enough that the prices for the products that we need and want are high. We don't need to be charged more when faced with a natural disaster. This was a well informing article that explained everything to the understanding of the average person.

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Mallory McCauley
9/20/2017 05:18:44 pm

The price gouging going on during hurricane Harvey and Irma is horrible and the person who is doing this should be ashamed. The prices of basic goods such as, water or food should not raise especially at this time in need. Instead of focusing of making a profit, communities and stores should help those in need. Gouging prices is not good for the business nor the people that need these necessities.

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Nate
9/20/2017 05:34:28 pm

I think that price gouging is a perfect example of the greed that is manifested in America's Capitalist Conglomerates. It makes me truly ashamed to call myself a member of the same race of the people who could ever do this to other members of humanity.

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Matt Wright
9/20/2017 08:03:22 pm

I think that Business during Hurricane Harvey was senseless, greedy, and shameful. Business should know that people are suffering and don't have much to spend. They are jacking up their prices for necessities that people need. People have no choice but to pay that price. That would make sense sort of if the southern part of the country wasn't going through a devastating storm. Business needs to be more caring for their customers in the future.

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Amy Kimmel
9/20/2017 09:52:41 pm

I feel that price gouging is not only distasteful, but also unethical. During the preparation and aftermath of Hurricane Harvey, Floridians, and others, were faced with high levels of stress and fear. Not only were their lives and homes in danger, but they were left without necessary supplies such as food and water as widespread shortages transpired. These high-pressure situations can very legitimately be “do or die,” therefore causing consumers to act quickly, with little regard to money in order to ensure their own safety. Unsurprisingly some sellers took advantage of the consumers’ vulnerable situation, jacking up prices and making substantially higher profits than on average. In periods of crisis, the ethical thing to do would be to make products accessible and affordable, regardless of the increase in demand. No decent human being should charge nearly one-hundred dollars for a case of water bottles, for example. Times of natural disaster call us to reach out a helping hand, working together for the greater good of all, rather than exploiting customers in peril. It is refreshing to know that some companies, such as Jet Blue and Martin’s Famous Pastry Shoppe, did just that. Realizing the immediate need for many to escape Florida’s impending hurricane, Jet Blue offered low flights out of the state. Lowering airfare to aide in alleviation of consumers’ stress and terror is a great example of an ethical form of handling such situations, realizing that the bottom-line should come after the wellbeing and safety of customers.
I can understand the argument that a higher price may be needed to negate depletion of supplies, however, I believe a store limit on said supplies would be just as effective. Despite the fact that it is against the Floridian, and many states’ laws, price gouging is insensitive to the needs of consumers and essentially takes advantage of someone at their time of greatest distress.

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Kennedy O'Shea
9/20/2017 10:38:46 pm

Price gouging, especially in the event of a natural disaster such as a hurricane, is ridiculously immoral and I honestly do not see how that would come across as a good idea to anyone except for the greediest businessperson. During hurricanes Harvey and Irma I saw many people, including celebrities, posting links to donate to companies such as the Red Cross to help fund relief and provision for those affected. This includes providing the people who need it with food, water, and other essentials in a time of crisis. The argument made that putting a cap on price inflation is the reason that empty shelves happen is negated by the fact that in a time of great need someone will always step up. This might be professional relief efforts such as the Red Cross, major companies that decide to be generous such as AT&T, or private organizations such as church groups, school clubs, or even families who decide to lend a hand.

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Jamie Bergolios
9/20/2017 11:42:56 pm

Although price inflation happens all the time, which is where simple products in high demand cause price increase. This is a time when there should be an exception made. Amazon could have found other ways around raising their prices of bottle waters. They could have outsourced from other companies. While outsourcing could mean more work for them, it would show their support during this time of crisis, which would have been a mindful marketing option. If it wasn’t amazon providing the water rather it was a personal seller then amazon should have taken that into consideration and planned accordingly. If for some reason they can not outsource, they can always prevent one person from stock piling this product, by setting a limit. Which would allow for more equality for their customers. Whenever something like this happens it opens the possibility of the fault being exploited through social media, and that could be detrimental to the company This situation could be used to their advantage if they’re willing to out the extra effort in to make a move that’s better for their customer rather than to prevent loss profit.

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Joseph
9/21/2017 12:19:30 am

I am appalled that in a time of need people would price gouge. In relation to Irma I have friends and family you live in the destruction path and to think they are being taken adventive of when they have no other option send shivers down my spine. I understand that for a business this makes senses in short term but the longer-term repercussions are not worth the money they will make. The power of the people is stronger then what businesses think; I think people will boycott the businesses that are price gouging. I think the limiting on the amount of items people can take is a more viable option then jacking up the prices. The fact that Irma did not directly affect me I could start to see how the laws of supply and demand could be helpful to make people ration their food. But in an emergency I feel people are going to want to help one another stay alive.
An example of a mindful business is chick-fil-a. Chick-fil-a was being protected against for their Christian views and being closed on Sundays and there sales were going down because of the protests. There was protests in front of Chick-fil-as in my area and remember talking to my dad about why people were protesting he said something I shouldn’t repeat but I remember think to myself that I think it is good have briefs you strongly believe in. then that very next weekend there was a natural disaster and Chick-fil-a under resent scrutiny open there doors that Sunday for all the people effected by the natural disaster. They gave out free food and clean water for the people that were able to get to a local chick-fil-a. After that all the protest stopped and Chick-fil-a was back in the good eye of the public and their sales went back to normal. This is an example of mindful business long-term commitment to being mindful.

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Rocky Holmes
9/21/2017 12:40:27 am

I believe price gouging to be unethical. In emergency situations, people's lives and livelihoods are in danger. Especially in the case of this hurricane, their homes, schools, churches, and work could very likely be destroyed. Raising the price of basic goods necessary for survival like water and gas not only targets those already being targeted, but endangers those who can't adjust to the inflation. While price gouging may not be earth shattering for someone in the upper middle class, 15.7% of those living in Florida live below the poverty line. In instances like this, those 15.7% (almost 3 million men, women, and children)'s lives are being put in even more danger than before. Matthew 25:35-40 says "For I was hungry and you gave me something to eat, I was thirsty and you gave me something to drink, I was a stranger and you invited me in, I needed clothes and you clothed me, I was sick and you looked after me, I was in prison and you came to visit me.’ Then the righteous will answer him, ‘Lord, when did we see you hungry and feed you, or thirsty and give you something to drink? 38 When did we see you a stranger and invite you in, or needing clothes and clothe you? When did we see you sick or in prison and go to visit you?’ The King will reply, ‘Truly I tell you, whatever you did for one of the least of these brothers and sisters of mine, you did for me." In this situation, we are called to take care of our brothers and sisters in need. Price gouging is not upholding that value.

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Courtney Hampton
9/21/2017 12:54:15 am

Hurricane Irma has already caused so much destruction and it is sad to think that people would try to hurt the victims of the disaster further. Ethical marketing is important when it comes to pleasing and respecting consumers, while also preserving their patronage and finding new customers. However, some marketing tactics still focus on the short-term payoffs. For example, the outrageous price demanded for just a few water bottles during the hurricane was completely unreasonable and uncalled for, especially because water is a necessity. The strategy used by the company’s marketers was narrow minded and looks only at the short-term. Their actions may seem to benefit them at the present, but I am sure their future sales and consumer loyalty will fall dramatically. Some people claim that the natural increase in the price of water would be beneficial and should be allowed or even supported. It will decrease the demand for water bottles because the price is so high, which will help preserve the supply and keep water on grocery stores’ shelves. However, I do not believe that the “survival of the fittest”, in regard to who has the most money, should be abided by because people cannot pay outlandish prices for water, especially during a natural disaster. It is understandable that the wealthy can afford to buy expensive houses and other goods, while the majority of people cannot, but everyone should be able to afford the bare necessities of life. Everyone wants to make a profit, but doing it at hurricane victims’ expensive is not the time. Ethical marketing should be used to determine the best course of action in the situation, so firms should think of the effects on others before they think of their profits. Forcing people to pay $99.99 for a case of water during a hurricane and price gouging in general is horrible, it hurts the consumers short-term, but it will usually hurt the seller long-term.

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Lila
9/21/2017 08:52:36 am

I do not believe price gouging is an ethical or appropriate action for businesses to be taking in these times or any. The only thing that these companies are doing is taking advantage of people who are in a compromised position and are struggling to find necessities while so many areas have been devastated and so many people are looking for these things for themselves and their families. Bottled water is not typically considered a necessity because most places in the United States have running water that may not taste quite the same as bottled water, but is just as safe to drink. At times of natural disasters, power and running water may be lost. In the case of Hurricane Irma, a large percentage of people living in Florida have lost access to running water. Because of this, bottled water has become a necessity for them. For a company to be selling a regular case of water for $99.99 is completely unreasonable. There is no reason that a company can't sell their products at the normal rate. Companies price their products to sell, but they also price them to make a profit. There is no need for a company to raise their prices because they already have things priced to earn a profit. While the item may now be considered a necessity, at least for this area, I believe the thinking behind the price raise is that people will still buy it so we raise the price and make more money. This may work but there are also other companies not raising their prices that will be much more appealing to people to buy. Trying to get more money out of people in a hard time is unethical in my opinion. One of the main reasons I say it is unethical is because the people in this area have already lost so much and have so much time and money that is going to be put into rebuilding their lives once the water has cleared away and the damage has been assessed. For these companies to step in and try and take money from people who have just lost everything or so much, is something I can't understand. In my opinion, it is common human nature to feel compassion towards these people going through this hardship and the only thing some of these companies are worried about is making extra money off of these people.

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Noah Cable link
9/21/2017 09:00:34 am

I think that price gauging should definitely be a criminal offense. Companies should not be taking advantage of the people who are in need. People could die because of these price increases because they can't afford the things they need in order to live. This makes me think of professional sports games and how they increase their prices just because fans aren't allowed to bring in food and if they are hungry they have no choice but to buy food there. I ended up paying $4 for a bottle of water last week at the Penn State game. It made me think of how I can buy a 35 pack of water bottles at the store for the same price. Is this also considered price gauging or is this called something else?

I know for one that companies who price gauge leave a bad reputation behind them. I almost think less of Amazon now because of their price gauging. I always used to think of them as a very fair and well ran company by offering free returns and good customer service. After reading this, I definitely have lost some respect for them by them trying to take advantage of people in their time of need.

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Erika Boice
9/21/2017 09:03:16 am

Price gouging is wrong on many levels. First is the ethical level, the people who need this water have been affected by a natural disaster. They don't have the basic necessities because of flooding, high winds, etc. damage. Most of them have lost so much because of the flooding, mainly, the flood waters have carried their cars, outdoor decorations, or anything outside away with their powerful waves. These people have been through a traumatic experience and just because they need the water even more does not mean that Best Source Office Supplies should exploit those people. Their need for the water has increased, they can pay the $100 for a case, but that would mean they have to give up something else that part of that money could be used for, like fixing some flood damage that, if not fixed, would cause long-term damage to the house and exponentially shorten the life of the house. Price gouging is wrong and Best Source Office Supplies is wrong for trying to exploit people who have been through a traumatic experience and lost a lot.

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Andrew Hernandez
9/21/2017 09:06:02 am

When I read that BestBuy practiced price gouging during the recent hurricane, I had the same reaction as everyone else. My reaction was that what BestBuy was doing was not only unfair, but also morally wrong. The problem lies not with the high price mark, but with the item that is being price gouged. The blog post gives an example that the iPhone X has a ridiculous $999 price mark. However, this is not price gouging because the iPhone X is not a necessary good. Consumers that place a value relative to the price of the product happily fork out the hefty price to have what they believe to be the latest in technology available to consumers. Water on the other hand is a necessary good and should not be priced out of the possible range that some customers can afford. BestBuy knew that people were in need and had to buy water even if it meant spending all the money they had on hand. BestBuy also broke the law by price gouging which is against the law in the state of Florida.
I think that raising prices during a time of disaster is a just practice. If consumers go to the store to stock up for the incoming storm, and are met with normal prices on everything included a limited supply of bread and water the natural thing to do is to buy an unnecessarily large amount of that good which leaves little for the next customer, and even less for the next. The consumers are not held to the normal supply and demand pricing that works well to ration goods in times of environmental normality. Mentioned in the blog post is a solution to the problem of consumer greed during a time of disaster. The stores should price their goods at a fair price relative to the demand. For instance, if I go to the market to get water and it is priced $8.99 for a gallon of water I will still buy what I need even though a gallon of water is typically priced at under $2.00. The larger price will lower the risk of consumers buying in amounts they don’t need.

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Cassidy
9/21/2017 09:38:26 am

I am in agreement that price gouging is absolutely despicable when people are facing a life threatening situation. There is no excuse for this. Companies, especially billion dollar companies like Amazon, have absolutely no reason to do this. They could give away millions of water bottles and it would not effect them much at all. In fact, it would bring them even more business because people would see that they are doing an act of kindness and would be more willing to buy from them in the future. It could create loyalty, especially to those that they helped. I do understand the fear of running out of goods, however, if a limit is placed on how much one can buy, I think that people who are facing this natural disaster would understand and be willing to take less in order for people in the same situation to also be able to have food. I do not believe that there is a permanent solution to this problem. People are cruel and will always take advantage of those who have no choice but to either die or buy the product they are selling. But there is no excuse for this, and I certainly have much less respect for Amazon and will be buying from them as little as possible in the future. As far as other companies such as Apple asking a high price for their new iPhone or even an over priced water bottle at a sports game, I do not think this is price gouging. It is a want and not a need. It is unfortunate that they do this for the people who would really like the iPhone but cannot afford it, but it is not life threatening. And most people can afford an overpriced water bottle, it is just more annoying than anything else. This is a well written article that is very informative for the average person.

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Randy Lohman
9/21/2017 10:54:24 am

Price Gouging and taking advantage of customers is morally wrong and I don’t understand how they justify their actions. At the same time, however, I don’t think it is the role of the government to try to stop something. Especially because once something like this happens how would one determine what is considered price gouging. That is to say it is relative, prices are influenced by a very large variety of factors and will fluctuate. Some cases such as the one illustrated in this blog post is very standard and easy to identify since water typically is not anywhere close to $99, and even the most expensive water would not be that much for a 24 pack. This is all to say that price gouging is determined through relativity which is not a very sound basis for a law. Once the government starts regulating prices of industry it has too large of a role and it will hurt the people and businesses in the long run.
Instead of the government having a role in stopping price gouging, I think the free market can and will take its course. Those stores that ae price gouging will lose the business of those producers and people will remember this the next time the need something. Where one store is price gouging then there is typically another store that may have higher prices than normal due to supply and demand, but nevertheless is not price gouging. In that case, people should go to the other stores that have better prices. In the case that it is the only store in the area with that product due to others selling their stock or through geography then there is an issue with little competition. I believe that this whole issue can and will be fixed with the “invisible hand”. People will remember those companies that price gouged and those companies will suffer over the long term even if they were successful while they were price gouging which is probably not the case.

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Nicole Hoppe
9/21/2017 11:41:01 am

I believe that price gouging is a mindless was of doing business. People are in serious need of necessities after a natural disaster and by taking advantage of that and makes it look like demand is simply not moral. Even with how wrong this is I do not believe that the government should get involved. I believe that if the government gets involved with this area it will want to control all aspects of how companies run their business. Instead, I believe that social media should be used to stop this from happening. If more word got out about what's going on, the power of social media would definitely stop these companies from doing what their doing.

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Matthew Phillippy
9/21/2017 12:31:55 pm

Price gouging has been a subject that has come into the spotlight several times in the past several weeks as a result of the emergency states in Florida and Texas. The first example I can think of is an airline that jacked up its prices for flights leaving Florida as a result of an influx of demand. It turned out that the price hike was not an intentional price gouging attempt by the airline, who used an automated computer system to price flights by checking demand. The airline quickly fixed the problem and were able to complete an ethical rationale of decisions to help out those who were in need of escaping. There are plenty of examples of others who chose to price gouge intentionally, as a means of exploiting desperate people looking for a way to survive, and this article was able to point out a candidate of these actions. This is a single-minded approach, as it may create stockholder value, but it is not able to uphold societal values. While I am all for capitalism and the government staying out of the business of companies, I believe that it is good that there are laws in place to prevent exploiting consumers, who would need to buy certain materials in order to survive. Exploiting people in crisis situations by forcing them to pay more for resources needed for survival is truly a wicked practice, and something that goes against the type of love that Christ compels us to show towards others. In the long run, it may be even more beneficial to show grace towards people in need and lowering prices to help out people- consumers are often impressed with generous companies and may switch their loyalty to a company based off of ethical decisions they make. This short term practice of price gouging is completely unethical, and a horrible practice for companies to partake in.

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Reagan Lyle
9/21/2017 12:34:23 pm

This is a mindless and greedy business practice. Racking up prices that high for when there is a need for the product in order to survive. I believe that the government should sell water and necessities at a static price during an emergency in order to give people an alternative and prevent the other business from raising prices for no reason.

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Joshua
9/21/2017 12:56:13 pm

It's actually kind of interesting that the topic of price gouging was mentioned in this article, because I happen to be taking Macroeconomics right now. In Macro, we learn that when there is a shortage of supply, the demand and price for that good must go up until demand and supply are equal again. In a situation like this, I do not believe that business should follow this model. In times of natural disaster and states of emergencies, I believe that this is wrong for businesses to do. I would not make price gouging illegal, because you are allowed to price your good however high and low you want. Morally this act is wrong and I agree with the Floridian leader who reported price gouging in her state and agree that if a company is caught doing it, people have the right to make it public. After making public what these businesses did it will ultimately affect that businesses market. Why? All because they wanted to make a quick buck? I honestly don’t understand how someone could do this act knowing that people are starving, thirsty, need gas and other “necessities.” I do hope justice is served for the victims who had to pay outlandish prices for basic supplies. In the article, I saw an add for a 32 pack of water was $99.99. That is ridiculous that we are trying to make a quick dollar off of people who are in need.

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Pepita Uwineza
9/21/2017 01:17:54 pm

price gouging on a necessary good during and after a disaster is despicable.It is ethically and morally wrong and I cannot understand how a company can possibly rationalize such behavior and believe it is okay to take advantage of people who are already in need and should be protected not robbed. Even a big NGO such as the Red Cross had ethical issues pertaining to hurricane Harvey when the CEO did not know which part of the donations were to be allocated to hurricane Harvey relief, the answer should have been all of them since they were given for that reason. Profit over humanity seem to have been a major problem during hurricane Harvey.

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Brooks Robinson
9/21/2017 01:34:01 pm

I found this report to be very interesting, mostly by the situation and the background of it, but also partially that I am personally connected to this story. My sister and her husband live in West Palm Beach, Florida. I shared similar anxiety as other people did who had friends of family in the wake of one of the strongest storms. Now in this report, multiple companies were price gouging on certain products of food, gas, water and the like during and before the tropical storm. Price gouging, besides being illegal when caught in many states, is also something that can be very grey on whether it is moral or not. I’m all for businesses making money and capturing the opportunities to up their price when their value increases to meet the new supply, demand and the newly fixed equilibrium. Price gouging on the other hand throws the stable market into a frenzy, especially like this article where multiple business gouged prices far above the average prices. People with much less income are a lot more vulnerable when products, at these prices, are the only things available for their survival. If the companies stayed in a proper price range, it would even the market out, and the decrease in the supply would be a lot slower and manageable for local companies to stock their stores. It would benefit both the business and the consumer.

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Keaton Kerr
10/23/2017 06:17:52 pm

I appreciate this examination of price gauging from a marketing perspective because I think it adds a dimension of thought that's not usually considered when the legislative debate over price gauging flares up. Most people forget about how Adam Smith's invisible hand is also effected by marketing principles, so the practicality of price gauging is inappropriately skewed toward a utilitarian ideal; consequently, people forget that companies who price gauge are going to lose business in the future from people who lost out in their greatest time of need.

At the same time, price gauging laws protect people in life or death situations. To simply leave price gaugers to the justice of the invisible hand places people at risk of not receiving necessary goods if they are completely incapable of paying for them. It's one thing to boycott a company after the hurricane because of their price gauging, but it's completely different for someone to die before they can boycott a company because they lack the funds to provide for themselves within a short amount of time. The marketing aspects of the invisible hand do not work for those who cannot survive to boycott. Consequently, laws are necessary to provide for these people when prices would otherwise be too expensive due to price gauging.

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Trevor Pence
10/23/2017 10:33:33 pm

Thank you for posting about this serious issue that many companies are guilty of. Millions of people will never experience such a horror in their lives thus are unaware of evil actions from major corporations. It is important to recognize this problem and take steps to address unethical behavior such as price gauging.

However, the serious raise in prices may also be due to supply and demand which naturally causes goods' worth to become more. This is no excuse for companies that drastically and suddenly increase prices to take advantage of people in need, especially those in need of necessities. Thankfully, laws punish companies guilty of such inhumane acts, but this does not make up for the lives lost by people who could not afford basic goods such as water, food, and fuel.

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Matt Roe
10/23/2017 11:29:40 pm

I think that companies or businesses are price gouging in disaster stricken areas is sickening. There are people hurting, struggling, and possibly even dying. Losing something such as your house is no easy task, and neither is rebuilding it. It takes some people years and years to build up their first home with its memories and all that comes with a home. Now those people have to build it up from the dirt once again. But hold up, now they have to buy water bottles to survive for 25 times the normal price? It is a crime to Americans. As a country, we need to be coming together in times of great need not driving each other apart by price gouging simple necessities to survive.

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Nic Nelson
10/23/2017 11:32:50 pm

Price gauging is mindless indeed, it hurts customers and it eventually hurts the stakeholders as well. Companies that care about their customers will make sure their prices are reasonable in times of crises. Companies should focus on both stakeholder value and societal values as they do business in any economic state. Companies should always do what is best for both their stakeholders and for the customers when in times of crises.

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E
10/24/2017 01:36:58 am

I was so surprised to read that companies participated in price gauging during this recent disaster. Families need basics like water and fuel to survive in crisis like these. Companies need to be looking at why demand has increased before driving up the cost. For example, sales rising after Dasani releases an ad is very different than sales increasing because people have no running water.
Companies can play a role in helping affected areas by continuing to supply products at normal prices, even though it may be difficult for them to deliver. Shops may have to ration as the blog article suggested. But families in need shouldn't be exploited for profit.

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Kenneth Goltara
10/24/2017 02:19:46 am

I don’t understand how people could price gouging. It damages the relationship between the company and its customers. It can also be a significant inconvenience for millions of people who were affected by the recent hurricanes. Even if the demand for natural resources is high; the prices shouldn’t be raised to an extremely high level to bring the company a lot of profit. It ends up showing the real motivation of people. They want profit, and they don’t care about how unethical it is to earn that profit.

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Brynn F.
10/23/2018 02:24:06 pm

Prior to reading this article, I had never heard of price gouging but I am surprised that it is a practice that so many companies get away with. It doesn’t make sense to me why companies would limit their customers access to basic necessities in a state of emergency. Emergencies are never planned and it is difficult to be prepared for them. I would think that companies would want to help people rather than take advantage of them. These actions not only threaten people’s lives in the moment, but are also likely to strain relationships for the future because the customer was mistreated and not supported in a time of desperation and chaos.
Therefore, I agree that companies who practice this are exhibiting mindless marketing. Their actions are done exclusively to boost their profits in a time where they should be demonstrating generosity.

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