Monday, December 31, 2012

'Price gouging' in the firearms market

Currently, prices are going crazy for guns, ammo, and accessories like magazines due to the possibility of new gun control legislation.  See for example

When this happens, without fail, I see a lot of commenters calling for the boycott of 'gougers' who raise prices in the face of demand.
This is counter-productive. Prices should increase as demand increases until supply equals demand. This is better for everyone.

A good link that explains this is "'Price gouging' in Florida" by Thomas Sowell.
Forbes has a nice infographic if that's your thing.
Even the leftist blogger Matthew Yglesias agrees.

I don't think that increasing the price on bottled water in a hurricane is wrong.  But, outrage at those price increases is more understandable, since water in a true physical emergency could be immediately necessary for one's health.  At this point, no new federal gun control laws have been passed or are close to passing, so this is much less of an emergency.
It's kind of weird to see a bunch of people who are supposedly capitalist conservative/libertarians to be economically ignorant and to get so emotional about businesses changing prices in response to a change in demand, which is what every business does everywhere all the time.

Bottom line: if you don't like the price, don't buy it.  If no one buys it, the price will come down.  If someone does buy it, blame them for the high prices, not the store.  The store is rationally responding to customer demand.  If the customer demand is irrational, that is the customers' fault.

P.S. This is not a defense of Cheaper Than Dirt in particular.  I have nothing against their price increases, but they are a store that has always had bad prices and bad attitudes about customer service.  At various times they would refuse to ship AR-15 accessories like pistol grips into California despite these being totally legal.

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