Excerpt
January 20, 2025, Paper: "Wepropose an economic definition of price gouging: Price gouging occurs when low ering the price from the market-clearing level would increase total Utilitarian welfare. In a setting with income heterogeneity and non-quasi-linear preferences (that induce a motive to redistribute across agents), our definition enables the use of price-theoretic tools to characterize circumstances under which price gouging might be occurring. We argue that these circumstances align with the contexts covered by existing anti price gouging laws, and derive further policy implications. By proposing a definition of price gouging that does not appeal to any non-economic notions of (un)fairness or excess, we hope to provide a pathway for follow-up theoretical and empirical research to analyze desirable policy responses. "