I think Uber is being smart here. Instead of being suckered into waiting too long for a ride, the user knows it is their decision. I wish restaurants would do this.
Restaurants do this with things like happy hours or early bird specials. The point is to help shift demand to off-peak hours.
If that's the case, it's actually pretty smart. Do you think it could work in other fields (such as restaurants, as you mentioned)? I mean, would people be ok with paying more in a restaurant that's crowded?
Restaurants already do this, but they do it in reverse. Instead of higher prices during peak hours, they offer discounts during off-peak hours.
As someone who never thinks ahead to make reservations, there are definitely times I would pay more to eat now. Though most of the time I would really rather know that they are busy, and just go somewhere else, instead of sitting there waiting for an estimate that could be way off.
Just like the customers and drivers mentioned in the story, if a restaurant decided to unpredictably charge double for their food due to being busy, I would go eat elsewhere and never come back. (Many restaurants do this predictably by charging less for lunch than for dinner, and attract different crowds)