Exactly.

I have thought a lot about this as well as the way businesses handle demand spikes. An example is how Costco and others handle spikes in demand on toilet paper. They will limit how many people can buy instead of just letting them sell out or raising the prices.

Why? Social pressure. I think economists overlook this SO MUCH. Social norms and ideas about greed have a massive affect on the market actors. Sure, Costco if it were a purely market based actor would just raise the price of the good based on demand. Over a longer time-span they will actually do this. But they usually do not for short term spikes in demand. It think its pretty obvious that the reason they don't do this is because the masses would think its terrible. Less people have a problem with limiting the amount one person can buy. That seems more fair to them.

Honestly, the pricing system is better as it does a better job of punishing those that are impulse buying and puts up a barrier to those that may not be thinking about their real need. The classic explanation about "price gouging" fits here. When a short term demand spike results in an increased price it will encourage producers to increase production while at the same time introduce time preference into the mind of those that delay their purchases. This helps supply handle the demand spike and results in those truly in need being able to get what they need.

If this were taught in schools... (pipe dream) instead of the socialist crap they train our kids on maybe companies would actually use the pure price system. But our population is so mal-educated that Costco would suffer far more from shifting to a pure price approach.

I think demand pricing is what Uber calls their approach and honestly it makes nothing but sense to me. I'm sure it is annoying when you get hit by it but it works. But, you know most people hate this. Drivers don't though... And if you really need an Uber and you get one in a high demand time its probably due to this approach.

I've given up on so much of this stuff. It seems so logical to me. We can see these approaches (market) work. But there are problems. Mostly due to brainwashing from socialist educators. They don't even realize they are socialists. That's what's so frustrating. Its not just liberals or democrats. Its pretty much all of them. The republican and Trump people are just socialists in different areas. Different markets and segments. But they are all so blind to this influence and its destructive consequences.