Response to Sarah Lacy on This Week in Startups Discussion of Price Gouging

Ms. Lacy,
I posted this online because you do not have your email available. (at least from what I saw you’re only reachable by social media)

I write to express my disappoint with the way you portrayed the concept of price gouging on This Week in Start Ups.
“Price gouging” is often maligned but it is a good thing for the following two reasons:

1. It sends a signal to service providers to provide goods where they are needed.
2. It causes consumers to ration goods and thus allocates resources more effectively in times when this is of utmost importance

I understand that some people have their sensibilities offended by pricing going up in times of crisis. However, not everyone shares this emotional reaction. I do not wish to question the legitimacy of an emotional response but I hope that you understand that by perpetuating an emotional response to this you make crises worse in the future for people like myself who live in New York.

Economists agree that anti-price gouging laws and anti-price gouging sediment make crises worse. The inconsistency between the way many people feel and the reality of the situation have been addressed by both NPR and Slate.

Sadly, I think those who criticize price gouging are like advocates of the death penalty. They emotionally feel justified but are on the wrong side of history. In any event, all the best.
Dan