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Ok, I am not going to fuss around the issue. The question is simple, but the internet is oozing with self-proclaimed behavioral scientists answering the question and it's hard to find a good, scientific answer to the query, so here goes:

Why are the toilet paper shelves out of stock around the world?

A lot of articles on the internet seem to lead back and quote this article from "The Conversation". Their slogan is "Academic rigour, journalistic flair", but I don't know the site and so what do you think of it?

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    $\begingroup$ I think it's a very clear example of 'Tragedy of the commons' where everyone acts in their own self interest to take a common resource before someone else takes it $\endgroup$
    – Ack
    Mar 20, 2020 at 19:40

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In simple terms, demand for toilet paper increased and supply was unable to scale up.

  • The supply chain for toilet paper is unable to rapidly scale up production to the levels required to meet the large increase in demand.
  • Most supermarkets (at least where I live) seem to be unwilling to increase the prices of toilet paper in order for supply and demand to equalise. Presumably, if the price of toilet paper in supermarkets was increased by 4 or 5 times (or perhaps more), we would eventually reach a point where toilet paper would be in stock. However, supermarkets would be accused of price gouging in a crisis, which would be bad for publicity (as well as people unable to afford toilet paper).

So why did demand increase?

  • Toilet paper is not perishable. Thus, people can buy huge amounts of toilet paper and they will eventually be able to use it.
  • There are few substitutes for toilet paper. There are items like tissues, paper towels, wet wipes, and bidets, but these are not great substitutes for most people, and in some cases, these are out of stock also. In contrast, while food is essential, people are able to eat a wide range of different foods.
  • Toilet paper is also an essential item. For most people the perceived cost of being without toilet paper is quite high. Thus, if people perceive there is a chance that they could run out, this is more likely to trigger an increase in their demand (to stock up).
  • As noted below, more people are using toilet paper at home rather than at outside the home (e.g., work, school, etc.).

Presumably, the increase in demand is triggered by the sum of the knowledge and motives of the many economic actors in a society.

  • Some people might be rationally thinking that it would be wise to stock up on toilet paper if they might be going into lockdown soon.
  • A desire to stockpile will further increase when people see that if they don't stockpile, they are more likely to run out of toilet paper. Presumably, international media and social media would help ignite the stock-piling and then the empty shelves and the associated media coverage further increase demand. So, shortages create even more shortages.
  • I'm not really clear on whether third parties are stockpiling toilet paper to sell at inflated prices. But it seems like normal rational behaviour (perhaps selfish when taken to extremes) can explain what is going on without the need for reference to such third party actors.

So, I'm inclined to think that normal rational economic behaviour combined with failures in the supply chain and an unwillingness to raise prices in response is the main explanation.

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    $\begingroup$ Another factor may be related to the similar issues with the food supply: a lot of folks are used to using toilet paper at work in some fraction. Industrial/workplace supply of toilet paper (big rolls for public toilets) isn't the same as domestic supply: a lot of those rolls that are used at peoples' workplaces don't fit on their home dispensers. It takes a bit of time for the supply chain to move over... (same thing with food: more people are buying groceries rather than eating out; grocery supply chains are stretched, restaurant supply chains are congested) $\endgroup$
    – Bryan Krause ♦
    Mar 28, 2020 at 6:37
  • $\begingroup$ When I started reading your answer, I almost started getting really angry at you for answering the actual question instead of the implied one and even angrier at me for not formulating the question more clearly and wasting time by doing so. Thanks for providing ans answer to why demand increased. Secondly, you don't fail to see the good in people and to assume rational thinking in most humans. I can't comment on that, as I really like your poised-and-rational-world answer. @BryanKrause 's comment is also very important. $\endgroup$
    – thymaro
    Mar 29, 2020 at 7:00

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