Sure, all of this is logical and works in a thought-experimenty way. I'd like to see some data that backs this up though.
Market reality and what looks great on paper are often two very separate things - we in startups should know this better than anyone else.
How many extra cars get on the road during these short surge events? Is it worth charging everyone 2X if it brings an extra 1% of supply? 5%?
One thing you get used to after dealing with startups for a while is to listen to what they're not saying as well as what they're saying. Uber, along with all other "sharing economy" startups, like to trumpet their social-good side (see: AirBnb and the "helping poor New Yorkers pay rent" narrative). The fact that they've released nothing even remotely resembling data regarding the supply-boosting effects of surge pricing is suspicious. My suspicion is that the effect is not substantial unless during extended surge events (say, New Year's), certainly not substantial enough to placate people looking at 2X, even 3X fares.
Market reality and what looks great on paper are often two very separate things - we in startups should know this better than anyone else.
How many extra cars get on the road during these short surge events? Is it worth charging everyone 2X if it brings an extra 1% of supply? 5%?
One thing you get used to after dealing with startups for a while is to listen to what they're not saying as well as what they're saying. Uber, along with all other "sharing economy" startups, like to trumpet their social-good side (see: AirBnb and the "helping poor New Yorkers pay rent" narrative). The fact that they've released nothing even remotely resembling data regarding the supply-boosting effects of surge pricing is suspicious. My suspicion is that the effect is not substantial unless during extended surge events (say, New Year's), certainly not substantial enough to placate people looking at 2X, even 3X fares.