> If the gouging is happening at the penultimate step of the supply chain and the profits mostly don't make it back to the manufacturer, then price gouging can't do much to incentivize higher production.
And that was, in fact, the problem with price gouging of PPEs in this pandemic. The manufacturers didn't raise prices, the stores didn't rise prices - it's the middle-men who swooped in, bought all the stock at retailers and wholesalers, and resold at inflated prices. None of the pricing signal made it back to manufacturers.
And that was, in fact, the problem with price gouging of PPEs in this pandemic. The manufacturers didn't raise prices, the stores didn't rise prices - it's the middle-men who swooped in, bought all the stock at retailers and wholesalers, and resold at inflated prices. None of the pricing signal made it back to manufacturers.