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> - In a local crisis, an increase in price encourages shipping in goods from areas not in crisis. Why would someone take the risk of shipping for the same price they can get elsewhere?

One reason is that people don't operate exclusively in the market paradigm, but free market economics makes the (false) simplifying assumption that they do.

> - As the GP mentioned, the ability to raise prices provides an incentive for stockpiling goods. Why would someone incur the expense of maintaining a stockpile in exchange for no benefit in a case where the stockpile is needed?

If you think about that actual scenario, that makes no sense as a business decision. People aren't going to pay the costs of stockpiling something in the off chance they can benefit from price gouging during an unpredictable crisis.

What really happens is parasites try to drain the supply chain so they can flip the goods at a price-gouging markup. You saw this during the pandemic: dudes driving around buying all the hand sanitizers and masks they could, then keeping them in their garage away from where they were needed, hoping to make a big personal profit. All they did was exacerbate the shortages.

[mhb]

You're arguing both that people respond to price signals and that they don't. Regardless of your dismissals, it is perfectly obvious that higher prices provide an incentive to supply more.

Anyway, what better way are you proposing to distribute goods?

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> You're arguing both that people respond to price signals and that they don't.

Actually, I'm arguing that classical free market economics doesn't lead to the best (or even good) results over all scales. IMHO, advocacy for price gouging is sort of like insisting on using classical mechanics to model quantum-scale phenomena. Price gouging is properly understood as a market failure, in that some people respond to the price signals by doing socially counterproductive stuff (and the supposed socially productive stuff is mostly a chimera in that context).

> Anyway, what better way are you proposing to distribute goods?

Your question assumes I'd give one answer, when my point is it depends on context. In some cases that's dogmatic free market economics, in other cases it's literal central planning, but in most cases it's something in between. One thing is clear, though: crisis shortages are not the place for dogmatic free market economics.