19 thoughts on “Uber Surge Pricing”

  1. I really enjoyed some of the comments on this one. McArdle says that people cannot be rational about this, and sure enough commenters show up who cannot bear to actually read what she writes and think about it. Just, Price Gouging – EVIL!

  2. One of the points from the article that nobody commented on over there (at least for the first day):

    While it can be annoying at times (during a recent rainstorm, I noticed a sudden epidemic of drivers canceling rides, which I suspect was due to the rapidly rising surge price), it also allows you to be sure that you will be able to get a taxi on New Year’s Eve or during a rainstorm as long as you’re willing to pay extra.

    So, while surge pricing is reasonable, cancelling previously contracted rides because of prices surging, is not. If I was Uber, I’d enforce a dead time for drivers that cancel a contract – say 2 hours of no new contracts.

    1. Sounds reasonable. And of course you can file ratings on your driver. A driver who cancels is going to be avoided.

  3. I read somewhere that various cab companies have tried to introduce a “highest bidder” policy for bookings and that customers universally hate it and refuse to use it. I’ve not heard of anyone doing it with a web interface, which might be a completely different experience and attract completely different customers, but I imagine that there’s regulations against it anyway.

  4. Yet again, we have elements of the left up in arms over something, due to their profound inability to comprehend that actions have consequences. Thus, they are incapable of comprehending that banning surge pricing or “price gouging” means supply shortages.

    1. Spoken like a true Marxist.

      Actually they do…every single time. So long as you read the right econ texts.

      First off, econ texts ought not try to predict human behavior other than to say people will decid based on their own perceived best interests.

      And the book ought to stop right there.

      lefty text books proceed to say what those best interests are – or ought to be (by force if necessary).

      Conservative texts stop with that one sentence and recognize that in a free society there is no way to predict what is in each individual’s best interest. Building a society based on that understanding has resulted in the greatest wealth created by any society ever.

      But it is being torn apart by addled, college freshman-brained, socialist lefties.

    2. Leftists wouldn’t be able to explain why a 1911 Ty Cobb baseball card is worth more than any other baseball card, much less worth a quarter million dollars, and upon further thought would invest in an Internet start-up whose business plan is to print tens of thousands of Ty Cobb 1911 baseball cards and make a fortune..

  7. ‘Gouging’ is abhorred by those that support thievery. Nobody is forced to buy anything (unless govt. is doing the forcing.) Until sold the property belongs to the seller and they can set a price nobody would pay if they like which would be no benefit to them.

    Thievery is the sin. Moral bankruptcy is the reason.

    1. To be more explicit… if you force someone to lower their price without competition you have stolen from that seller. The seller is innocent.

    2. Ask a leftist if they support theft and they’ll vigorously deny it. But their moral compass of what constitutes theft is messed up.

  8. It is easy to talk about surge pricing as if the market was ‘fair’. But in the real market things like collusion and hoarding do happen. e.g. Goldman Sachs manipulation of metal prices:
    http://www.rollingstone.com/politics/news/the-vampire-squid-strikes-again-the-mega-banks-most-devious-scam-yet-20140212

    One reason for the fall of the Monarchy in France and the rise of the First Republic was precisely due to the rise in wheat prices making it impossible for poor people to have enough to eat. In a situation like that economic mechanisms like surge pricing would cause more people to die in the short term. Period.
    Constantly shifting prices also make educated consumer choices and economic forecasting harder to do.

    I can understand that you are against rationing schemes and prefer to use price signals. But not everyone has the same amount of disposable income to begin with. These fact is these schemes reinforce economic inequality. The fact is people hate these schemes because they feel cheated. They end up paying more for what is, in their view, the exact same service.

    1. This argument does not include the fact that GS has first access to credit. It has this because the Fed gives them money at cheaper interest rates than the rest of the market. I would not call that a fair, nor a free market.

      The left gets their skivvies in a bundle over the banks and large corporations, but I have yet to hear one of them admit that collusion requires two parties. In this case, it is a large, centralized and bureacratic government that passes laws to hinder a free market.

  9. I wonder at the percentage of people opposed to any form of price gouging that are quite comfortable with overtime pay, bonuses for extraordinary danger (height, underground, etc) holiday pay and other forms of labor ‘gouging’.

    ” Heck yeah I worked on Christmas Sunday, it was double time and a half.”

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