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The End of a Fair Price: Dynamic Pricing and the Normalization of Gouging

27 points paimapi 1 hour ago 13 comments

bbor 36 minutes ago | parent

A yes, capitalism; a system that works perfectly as long as communication and data processing technology is innefficent enough to put a natural efficiency limit on all firms. Reminds me of the scandal around rental price "collusion", which ultimately was kinda just really effective software for doing stuff that would normally be fine.

*ETA:* And FWIW, the author here goes about as far towards that as they can -- a shoutout at the end! Anything else would be decried as biased, after all. Great article; shame it'll soon be downranked by the wonderful machines running this place :(

bix6 35 minutes ago | parent

You mean like withholding units from the market to overcharge renters when there’s people sleeping on the streets? Totally fine.

bbor 29 minutes ago | parent

That feels like a worthy critique but I'm not sure it relates? That's just how capitalism prioritizes capital over anything else, which is the core problem of course but isn't super related to the problems of increasing information. In fact, wouldn't this technique get harder to pull off as renters have access to better and better tools themselves?

RangerScience 19 minutes ago | parent

I wouldn’t expect it to; better information, without power to act on it, doesn’t do much.

That said, this’d be one of those things where you can say “this is my prediction”, and if it doesn’t come true, go looking for the forces and factors you missed from your initial prediction.

EA-3167 21 minutes ago | parent

Are you under the mistaken impression that chronic homelessness is caused by lack of housing supply? It’s much more correlated with mental illness and addiction in people who can’t be forced into care, but still desperately need it.

alphawhisky 5 minutes ago | parent

Are you under the mistaken impression that housing is not a human right? Do you protest your taxes being too high in response to this argument? They're much more correlated with the total number of children in 3rd world countries that got blown up in a given year. I can't force you to care, but you still desperately need it.

bix6 36 minutes ago | parent

At 176 pages I may read it but also I’m already so exhausted by this topic since nothing is changing.

autoexec 13 minutes ago | parent

It is changing. It's accelerating, spreading, and getting worse all the time.

sib 35 minutes ago | parent

"Did you know that home insurers use aerial drones to study your rooftop? If the conditions signal neglect, they might cancel your coverage before an accident."

While there are certainly some issues of concern in the article and the reviewed book, the above seems like exactly what insurance companies should be doing: pricing (or making available) coverage based upon risk.

This is not much different from an auto insurance company raising your rates (or cancelling coverage) because you've received a number of speeding tickets, which implies increased future risk of loss.

In fact, I received a letter from my homeowners insurance company a couple years ago stating that they would not renew our coverage due to conditions that they'd observed (clearly from aerial imagery) including overgrown bushes touching the walls of the house and some larger tree branches growing over the house.

I had a landscaping company come and fix the issues, sent my own drone up to take new pictures, sent the company the pictures, and they agreed to continue coverage. And now my house has less future risk of damage. This seems like a win-win for both of us.

mindslight 7 minutes ago | parent

[delayed]

nayuki 8 minutes ago | parent

> Uber is another key villain in Gouged. Per Owens, Uber’s “greatest innovation wasn’t ‘disrupting’ the taxi industry—it was socializing and normalizing the very idea of dynamic pricing. They made us comfortable with the notion that prices could change at any moment.”

In my opinion, Uber has several key innovations over traditional taxi services:

* An accurate machine-provided fare quote that you can review at your leisure before agreeing to take a trip. (Instead of, like, calling a human dispatcher to ask for a quote.)

* The fact that the passenger can't screw over the driver by making fake requests and not showing up, or running off at the end of a trip - because the online platform is in charge of the payment collection.

* The fact that the driver can't screw the passenger over by driving extra distance, because the price is set ahead of time.

xnx 8 minutes ago | parent

Competition, and being willing to shop around is the only thing that has ever kept prices down.