Ms. Ashley Moody, Attorney General
State of Florida
You issued more than 40 subpoenas in response to so-called “price gouging .” And you justified your actions with this written statement: “Floridians are searching for essential products needed to stay safe and healthy during this COVID-19 pandemic. Sadly, when they find these products for sale online, they often discover that the price tag makes them unattainable. This is unacceptable and unlawful.”
Your economics is mistaken: the price tag about which you complain is what prevents these products from being “unattainable.”
The high prices that you aim to push lower entice suppliers to exert the extra efforts necessary to ramp up production of such products and to speed them to market. These high prices also encourage consumers to use these products more prudently. Your efforts to push these prices lower, therefore, will ensure that such products very soon become “unattainable.”
Products available for sale at unusually high prices are obtainable, for they actually are for sale (if only at these high prices). In contrast, products unavailable for sale at ‘normal’ prices are not actually for sale; they are utterly unobtainable – which means that their prices then are infinite.
If you truly wish to ensure maximum access of Floridians to the goods and services that they seek, cease and desist from interfering with market prices.
Donald J. Boudreaux
Professor of Economics
Martha and Nelson Getchell Chair for the Study of Free Market Capitalism at the Mercatus Center
George Mason University
Fairfax, VA 22030