Why is Uber’s Surge Pricing Such a Big Deal?

For all the flak that Uber rightfully deserves on many recent issues – I don’t know why people get bent out of shape about surge pricing. The point is for them to incentivize more of their drivers to work by paying higher than normal rates for trips. These drivers do not work set hours. It’s their choice when to work.

In many cases, this could be better than over time pay.

The other choice is a set price, but no drivers. Ever notice you can never get a taxi at rush hour in NYC?

Comments

  1. Yes true – but that does not mean that the algorithm or human that makes the decision to increase prices do not consider the context.

    • While their approach can never discern the context of the individual customer (nor would it be fair if it could), no doubt they can probably predict often when surge pricing would occur and by how much.

      I saw a few people complaining on social media about a 2X surge pricing in the SF Bay Area last week during our mega storm. In my opinion, those drivers were taking a higher than normal risk driving people who either didn’t want to drive themselves, or were unwilling to deal with public transit in such crummy weather.

      For all that I know, Uber may have had fewer drivers available at that time for the same reason as surging demand: nobody wanted to drive in that crummy weather.

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