If you’ve ever used a ride hailing app, chances are that at some point you’ve experienced a higher than expected fee. Surge pricing is surely unpleasant when you’re on the paying end; almost everyone would prefer to pay less than more for a given product or service. Yet, as a form of dynamic pricing, such adjustments seek to balance the supply of drivers and the demand of riders, ensuring a well-functioning marketplace.
This functionality is core to market leaders such as Lyft and Uber. But does it have to be?