No matter how well prepared one might think they are for a natural disaster, there will be shortcomings and unexpected occurrences that could be detrimental. You could stockpile wood, water, and food, but there are things no one can predict. The economic market is one of them. Even at the best of times it can be variable, so when a natural disaster is included amongst everything else, things can shift dramatically. While basic economic rules tell us that if demand increases while supply remains stagnant or decreases, prices will adjust accordingly and rise. During a disaster though, opportunistic merchants can take advantage and raise the prices too high. That is why there are anti-gouging laws in various states and also why many politicians…show more content… He focuses on the example of Hurricane Fran from the summer of 1996. Over a million people in the East and North of North Carolina were left without power and in need of ice and chainsaws, which Munger blames the shortage on the anti-gouging legislation. No businesses outside the affected area had the incentive to bring the necessary supplies to those in need because there would be no profit for them. Munger writes that the anti-gouging law in North Carolina was “interpreted to limit price increases to around 5% or less” or face getting fined. (Munger, 2007). Thus, businesses that are capable of supplying ice or chainsaws will not make the trip to the areas that need them most because there is nothing for them to gain. Therefore, according to Munger, the anti-gouging laws has left people worse off than before because now there is no supply of the goods and services that people needed most even though there are people capable of providing the…show more content… Further research shows that many of the anti-gouging laws contain vague wording. For example on the New York Office of the Attorney General’s webpage it states “New York's price gouging law does not specifically define what constitutes an ‘unconscionably excessive price.’” And the webpage for Florida’s Attorney General is similarly vague with statements like “if there is a ‘gross disparity’ between the prior price and the current charge, it is considered price gouging.” The definitions are completely objective and to leave laws that carry a large impact on people open to such broad interpretation is problematic. Rather than getting rid of the laws like Munger suggests, they should be reviewed and made more specific. Maybe more similar to Oregon’s anti-gouging law which states that during an “abnormal disruption of the market” after certain disasters merchants cannot sell goods and services that “exceeds 15% or more than the price for which they were sold before [the disaster].” It then goes on the define circumstances that are not considered to be price gouging when the market is normal. Maybe 15% is too low, or too high some may argue, but the numbers can be changed. Oregon’s anti-gouging law is a step in the right direction though in order to make such laws more beneficial to better facilitate the return back to a more
