Comments on: Peoples Republic of Hawaii

By: Stephen Karlson

Stephen Karlson — Fri, 26 Aug 2005 14:45:43 +0000

The state’s behavior makes misguided use of a basic principle of competitive supply, namely cheaper inputs translate into cheaper final product. But the way this regulation works, with the retail price of gasoline not capped and the wholesale supply limited to that which can be profitably sold at the controlled price, there will be no gas lines as a somewhat higher retail price will clear the retail market. I use a variant of this in price theory courses (at all levels) all the time.

By: jocrazy0

jocrazy0 — Thu, 25 Aug 2005 23:04:05 +0000

Old law of supply and demand: “When the supply is low and the demand is high, you charge what the market will bear. When the supply is high and the demand is low, you raise prices to maintain profit margin” I’m not cynical. Nope, not me, nuh-huh, no way, nosir.

By: Knowledge Problem

Knowledge Problem — Thu, 25 Aug 2005 21:51:27 +0000

HAWAII PRICE CAP POST AT COYOTE BLOG

Lynne Kiesling I recommend reading Mr. Coyote’s post on the Hawaii price cap over at Coyote Blog. Very nice commentary. And thanks for the kind words!…

By: A Stitch in Haste

A Stitch in Haste — Thu, 25 Aug 2005 21:05:27 +0000

Richard Nixon Would Be Proud

Hawaii implements price controls on gasoline:

The caps apply as of next week, when a new law goes into effect. It lets Hawaii set a maximum wholesale price at which gasol…