Panic buying: more demerits than merits

From just face masks and sanitizers, to medical, personal or food supplies, the world has seen panic buying surge in many countries due to COVID-19. Pictures of empty shelves, long queues and videos of mishandling have been circulating across digital and social media. More than the shortage due falling production, the issue is of supply and distribution which has come to a halt in many countries due to lockdowns and the hurdles in the maritime trade and cross-border transport.

Whatever the case may be, research shows that people usually stockpile for future for two reasons: if the prices are artificially low or are expected to jump significantly in the future; or if they fear they won’t be able to buy them in the coming days. It is the latter in case of the ongoing pandemic. Research also shows panic buying behaviour is contagious as well as suffer from bandwagon effect, which is also evident how not only cities within a country, but also countries have caught from others.

Back home as well, daily necessities, including lentils, wheat and rice, as well as OTC medicines including those for children flew off the shelves as provinces announced lockdowns. What is more alarming is the fact that panic buying during these precarious times highlights and reminds of the inequalities in less developed and developing countries like Pakistan. While the households in the upper and upper middle class generally have the financial capacity to stock up for the rainy days, around 40 percent of the population lives below the poverty line and is not capable of any additional expense.

Rise in inequality further cannot be ruled out as the pandemic will take months to subside. An additional factor exclusive to the global pandemic situation driving panic buying in countries is the possibility of shortages due to disruption in supply chains across the world. While the Federal Minister of National Food Security and Research has been vocal about adequate stocks of essential food item, the fear and behaviour of consumers in Pakistan is also in part driven by a couple of food shortages in just a year and spiraling food inflation as a result.

Knowing this, the least that could be done is initiating quotas and setting limits to purchases of certain essential and staple items. Globally, this is being done by retailers, shopkeepers, and supermarket owners to combat the economic burden of the poor. They are setting limits of 2-3 items per person or per purchase and cancelling all loyalty programs for grocery, medical and hygiene products. Some are also bluntly pasting messages on billboards as well as in-store to remind customers and shoppers of their moral duties.

A similar strategy at least across all big stores, hyper/super markets in Pakistan could be adopted without much hassle. The last thing the country needs right now is to increase malnutrition and hunger. Statistic are pitiable already:  1 in 5 people are malnourished in Pakistan, and the latest Global Hunger Index shows that 2019 only, hunger claimed lives of 800 children.