ARTIFICIAL SCARCITY IN PRICE MECHANISM

PRICE MECHANISM

Price mechanism is a tool of setting price with relating to demand and supply when demand of any product increase price is also increase for a certain time period till the market equilibrium.

ARTIFICIAL SCARCITY IN PRICE MECHANISM:

As every one knows Artificial scarcity is a illegal practice and here price mechanism has a major role to do that practice. 

For example ; some supplier stores the commodity products in warehouse and didn't supply the good or products to the local vendor, so that there became a Artificial scarcity of that product or goods. But demand remains constant so where demand > supply so automatically price of the product increases  in the market, At the time that supplier sell the goods or products in higher price in market for their own benefit to get profit of the product to them. Which is a illegal practice according to law. this is also a process of price mechanism is related to artificial scarcity