In economics, a market condition where quantity demanded exceeds quantity supplied is called a shortage.
A shortage means buyers want more of a product at the current price than sellers are offering. In a simplified competitive model, shortages place upward pressure on price because consumers compete for limited units and sellers have an incentive to expand supply. The shortage ends when the market moves toward a price and quantity at which demand and supply match.
Shortages are often associated with binding price ceilings. If a legal maximum price is set below the equilibrium price, consumers may request more while producers offer less, leaving some potential buyers unable to obtain the product. Non-price allocation methods, such as queues, rationing, or favoritism, may then appear.
A shortage is not the same as a temporary stockout at one shop, although a stockout can be evidence of excess demand. Economists distinguish a shortage from scarcity: scarcity is the broad condition that resources are limited, while a shortage is a specific imbalance at a given price.