Earlier quoted context omitted.
I agree with almost everything you say. However, I do want to note that you can pay with dollars or pay with time. The old way was that you paid with time/uncertainty. You'd wait, and wait, and wait. Now you can get what you want right away, you just need to auction/bid on it to get it immediately. Totally agreed this solves the problem for those who can bear higher prices, so it disfavors the poor. That said, people…
>I do want to note that you can pay with dollars or pay with time. And it's generally far better overall to pay with money. If you pay with money, then someone gets that money - Uber drivers earn more through surge pricing, in this instance. If you pay with time, then that time is simply gone forever.
It's raining. There's one cab. The fare costs 5 dollars. There's two riders. The driver flips a coin. One rider pays $5, and gets a ride. The other has to wait, and then gets a ride.
It's raining. There's one cab. There's surge pricing, so the fare costs $15. There's two riders. One rider can afford to pay $15, and gets a ride. The other has to wait, until the surge dies down, and then pays $5 for a ride.
When there's a shortage of cabs, someone will have to pay with money. Under the lottery system, it's a random rider. Under the price surge system, it's the poorest rider. You haven't actually produced any more value in the third case. The same amount of time is wasted.