What defines "price gouging"?

Price gouging is defined as charging excessively high prices during emergencies. This practice typically occurs when a sudden increase in demand for essential goods or services arises due to unforeseen events, such as natural disasters, pandemics, or other crises. During such times, consumers are often in urgent need of certain products, making them more vulnerable to inflated prices.

The term usually refers to the unethical and sometimes illegal act of exploiting this urgency by dramatically raising prices beyond what is considered reasonable or justifiable. Laws in many jurisdictions exist to prevent price gouging during declared emergencies, reflecting society's recognition that such practices can cause harm and take advantage of vulnerable individuals.

Thus, identifying the situation in which prices are unfairly hiked during emergencies helps distinguish price gouging from other pricing strategies, such as discounts during sales or legitimate price increases based on standard economic principles like supply and demand.