1/ Proposition: surge pricing during emergencies is bad because generally hazardous conditions create more risk for those least able to pay.
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Replying to @vgr
2/ An isolated person having a heart attack during rush-hour surge pricing is merely unfortunate, not worth compromising market efficiency..
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Replying to @vgr
3/ ..because such isolated cases can be handled as exceptions while surge pricing deals with the default demand matching
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Replying to @vgr
4/ But in a snowstorm or emergency, those most at risk of being thrown into an urgent emergency are *least* likely to be able to pay
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Replying to @vgr
5/ And the incidence of such urgent-need cases will be too high to be handled as exceptions. The *default* needs to shift.
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Replying to @vgr
6/ So there is rigorous case to be made for distinguishing predictable, ordinary surges (rush hour) and emergency conditions
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Replying to @vgr
7/ It is not fundamentally a "moral" question about whether surge pricing is "fair." It is a practical question of logistics.
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Replying to @vgr
8/ You can rigorously quantify hazard/risk/ability-to-pay asymmetries and define thresholds that identify "emergencies"
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Replying to @vgr
9/ Once you've quantitatively bounded "emergency conditions", how do you design a market mechanism to deal with it?
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Replying to @vgr
10/ First, you can expect supply to increase out of altruistisms, rather than just financial motives. So you can surge to a lower price
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11/ Second, you can tweak the dispatching system. Instead of a FIFO queue, explicitly create a moral luck game weighted by urgency of need
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Replying to @vgr
12/ Once system has detected "emergency" conditions, people can hail with an urgency level indication as in "I broke my leg"
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Replying to @vgr
13/ Of course this can be gamed (think evil Billy Zane character in Titanic). But burden of proof mechanisms are possible.
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