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This article asserts that if taxi cabs were run out of business by Uber then nothing would remain to keep Uber's prices in check. That is completely incorrect.

This article asserts that if taxi cabs were run out of business by Uber then nothing would remain to keep Uber's prices in check. That is completely incorrect. There are a number of competing apps for rides (or they would be built quickly to compete) and cars could freely undercut Uber. I'd be the first to jump in and build an app that pulled each service's ride price to compare options. If price gouging continued, lower priced alternatives would flourish. I'm struggling to see why this demand-driven pricing when provided BEFORE you get in the car and make your purchasing decision is a problem. Without price gouging, would you even be able to get a ride in a snowstorm? Just because something is available in good conditions at a normal fee does not mean you can just stop planning your logistics and assume that service will be available all the time. That said, what the market-based alternative does crowd-out is those without the resources to pay spiked fares that may have lucked into a cab in previous circumstances.

jtbigwoo 13y ago
>> There are a number of competing apps for rides (or they would be built quickly to compete) and cars could freely undercut Uber. That's one possiblity. Another is that network effects would allow Uber (or Lyft or whatever) to dominate local markets since drivers and riders would flock to the most popular. The barrier or new entrants is going to get pretty high if Uber can snap up enough drivers.
- sailfast 13y ago
  True, but there is no shortage of drivers even if they start snapping them up. For $20 a mile, I'll get in my car and pick you up. Uber would have to corner the market for all drivers by paying them off which is... expensive, and extremely unstable. If you required a CDL or other more involved permit to pick people up that might restrict supply but I don't anticipate demand outpacing supply of drivers if there is money to be made.
metaphorm 13y ago
transportation is a basic infrastructural need. there is profound social harm done when demand from the wealthy forces prices to rise to the point where poor and middle class people cannot afford it.
- tcpekin 13y ago
  The fact that Uber may charge more during peak hours does not eliminate the fact that the poor and middle class from using buses and subways, basic government supplied transportation, both of which are abundant in Manhattan. I don't really understand, at this point, how Uber could possibly cause social harm with flex pricing. If Uber was the only option, sure, and maybe that is what you're arguing. But I doubt the poor rely on Uber for transportation, and there are still several other options.

jtbigwoo 13y ago

>> There are a number of competing apps for rides (or they would be built quickly to compete) and cars could freely undercut Uber. That's one possiblity. Another is that network effects would allow Uber (or Lyft or whatever) to dominate local markets since drivers and riders would flock to the most popular. The barrier or new entrants is going to get pretty high if Uber can snap up enough drivers.

sailfast 13y ago
True, but there is no shortage of drivers even if they start snapping them up. For $20 a mile, I'll get in my car and pick you up. Uber would have to corner the market for all drivers by paying them off which is... expensive, and extremely unstable. If you required a CDL or other more involved permit to pick people up that might restrict supply but I don't anticipate demand outpacing supply of drivers if there is money to be made.

metaphorm 13y ago

transportation is a basic infrastructural need. there is profound social harm done when demand from the wealthy forces prices to rise to the point where poor and middle class people cannot afford it.

tcpekin 13y ago
The fact that Uber may charge more during peak hours does not eliminate the fact that the poor and middle class from using buses and subways, basic government supplied transportation, both of which are abundant in Manhattan. I don't really understand, at this point, how Uber could possibly cause social harm with flex pricing. If Uber was the only option, sure, and maybe that is what you're arguing. But I doubt the poor rely on Uber for transportation, and there are still several other options.