Moving to Florida at the start of hurricane season sounds like a terrible idea. But as an economics professor, I couldn't think of a better time to kick off the semester and teach people how a market economy works during a disaster.

As fate would have it, the week Hurricane Florence hit the Carolinas coincided perfectly with my lecture on price controls. The 500 price gouging complaints in North Carolina and 118 filed in South Carolina during the disaster's aftermath serve as a timely reminder that the forces of supply and demand are still widely misunderstood—and that setting prices based on perceptions of fairness does more harm than good.

Understanding "Fairness" and Supply and Demand

Student reactions to this argument are predictable. When I suggest the neighborhood 7-Eleven charging $20 for a case of water after a hurricane is actually a good thing, they're shocked. Brows furrow and distrust colors their faces as they wonder how I could condone such seemingly exploitative behavior. But by the end of class, I can usually get some thoughtful questions from students and even some nods of approval.