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So who else believes the term "Surge Pricing" is horrible? What if instead of charging more for busy times, they charged less for slack times, and call it "off-peak" pricing, with bigger discounts for times when there are fewer riders. The rate table stays exactly the same, it is just a matter of the optics of how things are presented. Now the 99% get deeply discounted luxury black car service when the 1% aren't using it. I suppose some of the "rich" won't like the association of using a discounted service, but I'm sure no one is going to get extremely angry, like some people get with the current nomenclature. Seems like someone dropped the ball in the marketing department because their libertarian mindset didn't take human psychology into account. Thoughts?

Because transportation is a vital element of our economy. The same problem with price gouging. Very short sighted market lock ups turn into much bigger problems. I guess we just need to learn this lesson once again.

Edit: I should add that that the biggest problem with gouging in a market is that the sellers actually over price.

Lyft tried this and called it "happy hour". The optics of this on the driver side were atrocious, driver morale went through, the floor, and quality of service as well.

This is also going to make a base pricing look uncompetitive with the regular taxis, and they will use that in advertising.

"Couldn't afford" is a loaded term. I can afford a helicopter ride home, but I don't value its utility enough to pay what's being asked. Isn't that how prices are supposed to work?

Only if you equate price and value, but given vast discrepancies in wealth it doesn't really make sense to do that, since an extra $20 to someone making $250K/year doesn't have the same meaning as one making $25K/year. Consider the old way of doing such things, where there was a queue to get to the taxis, but everyone paid the same price. In that scenario the best measure of value is probably how long someone is willing to wait in line. Now imagine that same queue except anyone willing to pay twice the normal cab fare could just cut in line. Would you call that "allocative efficiency"? Or perhaps you would simply call it unfair?

Neither way is perfect, though.

For the queue, let's say Alice and Bob both make $25k/year. Alice desperately wants to get home to, I don't know, say goodnight to her kid and wake up early to get to work in the morning, while Bob is just going out drinking and doesn't really care about it that much. Is it efficient to prioritize Alice and Bob equally, or would you simply call it unfair?

In a surge pricing regime, Alice might be willing to pay, say, $50 while Bob is only willing to pay $10, and Alice will get a higher priority because she cares much more and her stuff is much more important. Isn't that a win?

I see where you're coming from with income disparities, but I think that talking about how it translates into problems with surge pricing is basically discussing the symptom rather than the cause. The root problem there is that one person can make 10x as much as another person without being anywhere near 10x more valuable. This causes a ton of secondary problems, of which the availability of taxis and taxi-like entities is one of the least important.

Have you ever actually used one of these services? If you can't afford it, the best strategy is to wait. Having driven for both of them - I can say that among my clients have included: A person with felony manslaughter on his record who had to get to his work on time (getting fired is horrible you are a felon because getting a new job is a non-trivial exercise). An enlisted (very junior) military family of 6 (only 4 were in the car) who needed to get some late-night shopping done at a distant walmart. The father was on deployment and only had a high school degree. Because of the high cost of taxis and the inconvenience or slowness of public transit, these were NOT options for them. Not to mention the scores of homosexual clients who were vehemently opposed to taking taxis because of repeated taxi drivers who had harrased them (this doesn't happen as often in a Lyft/Uber because of the rating system).

So, you can rail against the surge pricing, or think of it this way: Because it's something that happens largely during luxury times (e.g. bar closing) that taxes those who are wealthy and have disposable income, subsidizing affordable, safe, and convenient travel for the less privileged during other times.

"luxury times" ? Is fair-priced travel a luxury now?

OK, I'll bite: What is "fair"? Isn't allocated to the users who value it most fair?

Translated again: People who value it the most highly can get it when they need it, while people who don't need it as much can wait or find alternatives. When demand is highest, they do the simplest and most effective thing to draw in more drivers who are free agents - offer them more money.

In effect, the earlier riders who accept the surge and book anyways pay more to draw more drivers in, and in return get their rides first. Riders who can't afford or don't want to pay for the surge prices can just wait for more drivers to come and the earlier demand to be satisfied. It's effectively the same as a crowded cab stand, but instead of the arbitrary order of who got there first, it's ordered by who's willing/able to pay the most, and thus who getting that ride fast is the most important to. A lower-income person who needs to get somewhere on time can sacrifice a little more and get it, instead of having no options.

FWIW, the actual 1% most likely have actual private drivers and entourages. And are important enough that almost anything they're going to will wait for them.

Why are you even on this site? If you think rich people are out to get the poor, why spend time on a site whose themes are technology and wealth creation through technology? Why not go down the park and shout slogans and wave placards at the passing '1%'

You impugn morals on price activity when there are none to see. For all we know, the high price takers wer students late for an exam, a young man determined not to be late for a first date or a relative rushing to the airport to see their family arrive.

It is far better for supply to increase when needed than for supply to remain fixed and the market to stay uncleared. There is nothing myopic, wrong or class based about that, and it is childish to even look for it.

While the 'how dare you consider those less fortunate than you, you don't belong in our tech paradise where only self-serving extremist libertarian thought is allowed' line of argument is particularly revealing about your attitude it isn't particularly welcome or mature. It is childish to not notice the disparity. I don't even disagree with any of your points, but your obvious hatred for anyone who doesn't support the oligarchy is just gross, I think if you tone it down you'll find people much more willing to agree with you.

Quite frankly I don't care if people agree with me or not, it's an opinion site not a popularity contest. Toning down opinions for the sake of not ruffling feathers is the work of politicians, and I'm not one of those.

You've also interpreted meaning to my comment which did not exist. 'Considering those less fortunate than you' has zero to do with understanding dynamic market pricing. Anyone who implies a morality to price action misunderstands the entire principle. Uber doesn't increase prices to laugh at people who are priced out of the market. They increase prices to encourage more supply. Anyone who reads a moral side into the argument will never have a balanced thought about it, and is always going to be wrong.

Recognize that none of the arguments we make here are deductive logic, rather they are entirely persuasive. You fail to be persuasive because you express hate and disgust where it's not necessary or appropriate, hence your arguments fail where perhaps they could succeed. If you don't care whether or your arguments succeed then why bother responding? Your opinion is what it is and nobody will ever change it and you should have no need to ever express it, it's just wasted words. Of course this is silly and you do care if people agree with you or not.

Anyone who refuses to consider morality when it comes to economics and price action is always going to end up at a horribly misguided and perverse world view; you retract your ability to do moral reasoning in order to be 'objective' but miss that the assumptions you've made to even have a market economy exist in the first place have moral weight. You cannot ever escape ethics and morality unless you resign yourself to only discussing technical cause/effect in a particular system and never making any human judgments about it, anyone in it, or any effects of it.

I think you use faux economic objectivity as a shield to protect yourself from the consequences of the actual moral judgements you are making about the less fortunate. If economics says morally reprehensible things will occur then economics is /wrong/ and it is our moral responsibility to force a solution other than the market one to that particular problem.

You look at the intentions of the rich (which are wholly irrelevant) but never the consequences of their actions; it was never the intention of the plantation owners to enslave people, rather, they just wanted free labor to more efficiently produce their products. A noble goal, yes?

Why is HN upvoting someone's poor-quality school homework assignment?