Amazon is cracking down on third-party merchants for selling coronavirus-related products at inflated prices. The company says it has recently blocked or removed tens of thousands of listings for such products, like face masks and hand sanitizer.
“There is no place for price gouging on Amazon,” the company said in a statement.
On Amazon, some third-party sellers have been charging hundreds of dollars for a couple small bottles of hand sanitizer or a box of protective face masks.
Dana Radcliffe, who teaches business ethics at Cornell, said Amazon was smart to ban these listings — because customers do not like price gouging.
“People have a very strong reaction to it,” he said. “They feel that they’re being taken unfair advantage of. So that’s going to reflect upon the platform.”
Many economists, however, say it’s a bad idea to set rules around price gouging, like limiting price hikes during a public health crisis or a hurricane.
That’s because when prices are low it’s easier for people to hoard.
“You’ll see people loading up their carts with far more than they would if the price were higher, and the consequence […] is that people [who] get to the store later aren’t able to buy anything,” said Michael Salinger, a professor of economics at the Boston University Questrom School of Business.
It is hard to say exactly what qualifies as price gouging, versus simple supply and demand. And it’s hard for companies like Amazon to draw the line.
COVID-19 Economy FAQs
What’s the latest on the extra COVID-19 unemployment benefits?
As of now, those $600-a-week payments will stop at the end of July. For many, unemployment payments have been a lifeline, but one that is about to end, if nothing changes. The debate over whether or not to extend these benefits continues among lawmakers.
With a spike in the number of COVID-19 cases, are restaurants and bars shutting back down?
The latest jobs report shows that 4.8 million Americans went back to work in June. More than 30% of those job gains were from bars and restaurants. But those industries are in trouble again. For example, because of the steep rise in COVID-19 cases in Texas, Gov. Greg Abbott, a Republican, increased restrictions on restaurant capacities and closed bars. It’s created a logistical nightmare.
Which businesses got Paycheck Protection Program loans?
The numbers are in — well, at least in part. The federal government has released the names of companies that received loans of $150,000 or more through the Paycheck Protection Program.
Some of the companies people are surprised got loans include Kanye West’s fashion line, Yeezy, TGI Fridays and P.F. Chang’s. The companies you might not recognize, particularly some smaller businesses, were able to hire back staff or partially reopen thanks to the loans.
You can find answers to more questions on unemployment benefits and COVID-19 here.
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