Critique: Gas Prices

In response to “Why Are Gas Prices Rising,” I don’t wish to go against the authors post, but maybe add more thought to what was given and why the economy has faced such a hardship while trying to deal with the outrageous prices of gasoline. Ever since the on start of the recession, people affected by the decline in the economy have been prioritizing their wants and needs. Whether completely diminishing a good or perhaps settling for an inferior good, people have been able to cut back on a great deal of their spending in hopes to increase their money supply. There are four determinates pertaining to the demand side of the economy; how high a person’s income is, which ultimately decides whether they buy a normal or inferior good, their preferences, the population, and the prices of other goods. When it comes to gas, if one suffers from a low income, they can’t choose the inferior good because there is none. It’s not like if we go to our local grocery store where the gas price is outrageous, we can instead choose to go to Wal-Mart and buy the ‘off-brand’ or ‘out-of-style’ brand of gasoline like we refer to so many other things we buy. And lastly, there is no substitute for gasoline; we can’t choose to put apple juice in our cars because it cheaper than gasoline. Any where we go, we are stuck with a price, given it may vary a few cents depending on the gas station. Gasoline is a good that most people in America need, given the exception of the population that live in large cities and are easily able to commute due to trains, subways, busses, and other forms of public transportations.

Even though the recent prices of gas have most people, including myself, in an outrage, it helps to look at the recent patterns of the price changes that have occurred in the past. Not too long ago, this exact same thing happened. We were paying around $2.00-$2.50 a gallon but it dramatically increased to $3 and $4 a gallon. And yet a few months later, the prices dropped and people quit fussing. Like any other good, gasoline falls in line with inflation and deflation. There will probably never be a set price for gas. Also, as the author of the original post stated, it seems a big reason to blame for these high prices are due to the fighting occurring in Libya. However, Libya produces only 2% of the oil currently pumped out of the ground and is ranked on 17^th with respect to oil-exporting countries. To me, it seems like the circumstances occurring in Libya could not cause such a significant rise in the prices. Lastly, the time of year has an effect on the prices. During the summer months as well as the holidays, gas prices tend to rise due to the increased number of people who travel. I think that since its mid-April, basically the beginning of summer, gas prices will rise regardless of the things occurring around the world. Granted I definitely agree they shouldn’t be this high, but I do expect a price increase.

I think it’s hard to come to an agreement while dealing with such prices, but I think we just need to agree that nothing will ever stay the same. Prices of any good will always be increasing or decreasing but we need to prioritize and find the best solution for each problem we are faced with.