Question

Please elaborate and explain thoroughly. Thank you!

What is price gouging, and should it be legalized?

Answer 1

Price gouging is a prerogative term used to define an activity where a seller spikes the prices of goods and services to earn a supernormal profit. This increase is generally at the time of an emergency like shortage of that good, a disaster etc. The prices are increased to an unacceptable unfair level and this is done with the goods of general necessity like bottled water, heating elements which are extremely important for the people struck by that disaster.

Yes, the practice of price gouging should be legally banned or regulated, it will prohibit sellers from taking advantage of people in need. Laws can set a maximum price limit at which the goods can be sold and they can also make a category of essential goods on which the law will apply. This will protect the consumer interests at the time of necessity.