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Letters: Pricing gas

January 05, 2013

Re "'Zone pricing' plays big role in gas costs," Business, Jan. 2

Congratulations to The Times for discovering economic theory. Costs do not set prices. Prices are defined by the equilibration of supply and demand, and when demand varies by location then price will vary by location.

Maximizing profits from selling gasoline is why people bother to sell gas, or for that matter any product or service allocated by market mechanisms. Who knew?

James E. Moore II

Los Angeles

The writer, a professor of public policy and engineering at USC, is the director of the university's transportation engineering program.


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