Originally posted by Enzo
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According to the economists who can see in 48-bit color, a free market is defined as the transfer of goods in a non-distressed voluntary transaction between a willing buyer and a willing seller.
Clearly, the guy who has a monopoly on gas and charges usurious rates to distressed buyers is not selling in a free market and he is price gouging. But like you say, the term gouging gets over applied.
The term "gouging" tends to get over used by crybaby-types who like to accuse the other party of "gouging" just because the asking price is higher than they want to pay. "Gouging" claims tend to pop up whenever something is expensive and out of reach. The problem is always that the other guy's price is too high, the problem is never that the buyer is just too cheap to pay the market rate. In the worst case scenario these whiner types will try to skew the market by trying to enforce artificial price controls. Communism. Socialism. Fascism. Capitalism. Take your pick, but the truth is that artificial price control is the enemy of the free market.
It's important to bear in mind that if we're talking about a discretionary purchase then by definition there can be no gouging because the buyer has the option to tell the seller that the price is to high, and to walk away from the deal. If you participate in a voluntary non-distressed transaction and afterward you accuse the seller of "gouging", the harsh truth is that the problem is that you're just angry about being a crappy negotiator.
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