Planning vs. Improvisation
In this essay, I write
After Hurricane Katrina, the United States faced a shortage of gasoline, caused by the disruption of refining capability. My worst fears were that panic would break out, and Americans would rush to fill their tanks, making it difficult for people with critical needs to find gas. There was a need to conserve gasoline until production could be restored. It turns out that the markets produced exactly such a response. The rise in gas prices, which in my view was relatively small considering the sudden severity of the crisis, was sufficient to induce people to live more fuel-efficiently for a while. The law of demand worked much better than any centralized rationing scheme.