Monday, May 21, 2012
The cartoon is spot on for gas prices in Chicago. Gas Buddy shows you the price of gas where you live.
Iowa continues to be well below the national average. In Muscatine, the price was $3.25 this morning.
Owning a car gives the owner the freedom to pursue personal endeavors. America values freedom. One price that society pays for this freedom is a cost for the resources that society uses. A higher price reflects the value that society gives to gas. Of course, a higher price has distributive disparity. The higher cost exerts more pressure on low income earners than high. Higher gas prices also ensure that the people who value the gas the most will be able to buy it when they want to.
In the fantastic book, The Price of Everything, Russ Roberts, explains the price mechanism.