If you look at my example at the end of post #98, two families have different needs but both could come up with $150 if they needed to. Need in that example is indeed equal to "willingness to pay". The difference in the families is only who has relatives nearby. You could think of that as one extreme, where all people have the same wealth, but different needs. The other extreme is that all have the same basic need, but extremely different ablity to pay. Neither extreme fits the real world. People have different ablity to pay, but there are also poor people with relatives nearby, and rich people with no relatives nearby, thus different needs than those with no relatives nearby.
Let me try an example that incorperates both wealth (your focus) and differing need (my focus).
Say we have 400 hotel rooms at $50, 400 wanted by rich families, half with relatives nearby, and 400 wanted by poor families, half with relatives nearby. That is 400 rooms but 800 demanded.
My solution: $150 price.
Result: Hotel rooms occupied by:
200 Rich with no nearby relatives
25 Rich with nearby relatives (hey, there rich)
175 Poor without nearby realtives
=400 rooms
Others:
175 Rich stay with nearby relatives
200 Poor stay with nearby relatives
25 Poor cannot afford $150, are on the street (or drive farther out)
=400 with no rooms, of which 25 poor are on the street (or have a long drive).
Your solution $50 per night
Hotel rooms first come first serve (say randomly):
200 Rich get hotel rooms, half with nearby relaives
200 Poor get hotel rooms, half with nearby relatives
=400 rooms
100 Rich Stay with nearby relatives
100 Rich on street (or drive farther out)
100 Poor stay with nearby relatives
100 Poor on street (or drive farther out)
=400 witout rooms of which 200 are with relatives and 200 are on street or must drive far.
So rich people can come out better in a disaster in general, and rich people come out worse in your solution. But poor people as a group are also worse off in your soulution, assuming 100 poor families on the street is worse than 25 poor families on the street. Of course, you can tweak the numbers if you like but the point remains. Rich and Poor alike, both groups, are worse off under your solution. Your solution of no price increase results in a lot more hardship. If you are woried about the poor busting thier budget then give them aid after the fact, but please don't put 175 additional poor people on the street in some sort of moral crusade against "greed".