A Creative Conspiracy Theory
By Bryan Caplan
If gas prices go up because of business conspiracies, why do they ever come down? In his Daily Kos review of my book, Dean Nut proposes a staggeringly original explanation – and as far as I can tell, he’s serious:
If the oil companies kept their prices at a consistently high level, consumers would lose hope of them ever descending and making their gas-guzzler SUVs affordable again. Then the consumers would go out and buy Hondas and Priuses, thereby reducing the demand and thus the profits of the oil companies. So instead, the price of gas jumps around, and consumers are thereby given incentive to hope that “it will come down again soon”.
This brings to mind the theory that the apparent collapse of Communism was a plot to lull the West into a false sense of security.