Surge pricing is not rent-seeking. If the surge pricing was not warranted by the situation, then it creates a trivial way for competitors to eat the business's lunch by offering the same service at a slightly lower price.
"Uber is surge pricing right now but Lyft is not, so I'll get my ride with Lyft"
Surge pricing is a legitimate function of a properly functioning market. When demand has skyrocketed, or supply is constrained, prices _should_ rise. This is the mechanism by which markets enable resources to be allocated efficiently. Whether someone is poor or rich, if they desire a thing more than other people do (for the sake of argument, other people of similar wealth), then they should have a mechanism by which to express that preference. That preference is the price they're willing to pay.
If the area is congested, and you _really_ want to go somewhere right now, then surge pricing gives you two ways to accomplish this. (1) To the extent that capacity is fixed, the ability to out-bid someone else means that you can take the capacity from someone else who doesn't desire it as much as you do. (2) The higher price incentivizes more supply. Uber drivers who see an exceptional surge price will make themselves available in order to take advantage of higher wages. A higher surge price is pure profit for the driver, if he can make himself available to drive right now versus some other time in the week
Lastly, no supply is fully constrained. If the price of parking in a city skyrockets, then this creates a strong incentive for parking businesses to find a way to make more parking available. This might mean buying existing buildings, demolishing them, and converting them into parking structures; or it might mean that in the routine course of building new structures, the high price of parking will make it economical to dig a few stories deeper and provide a few more levels' worth of parking. Price and incentives always influence the operation of the market.
Surge pricing in Uber's case is not rent-seeking if surge-pricing actually increases supply (i.e. more drivers on the road). My gut says it doesn't ( don't think that drivers get out on the road fast enough), but I don't have the data to prove that.
But in the case of parking spaces, I don't see how me being able to out-bid you for the last space makes me a more qualified candidate for that parking space. I'm paying a higher price for the same good, the number of spaces isn't going up, and the owner got richer without adding any value. Textbook definition of rent-seeking if I've ever seen one.
High parking tension means that people will try to make more parking, but is that the most effecient allocation of resources? What about alternative solutions, like mass transit? This is a digression, but you mentioned it with supply.
On a more pragmatic level I don't really think the ultra-rich have that much more of a right to a parking space downtown on a Saturday any more than I do, and a parking space is more or less a public good (and should be shared as such).
> Surge pricing in Uber's case is not rent-seeking if surge-pricing actually increases supply (i.e. more drivers on the road). My gut says it doesn't ( don't think that drivers get out on the road fast enough), but I don't have the data to prove that.
From what I understand, fear and hatred drive public policy more than objective data does. I doubt it is going to change any time soon.
"Uber is surge pricing right now but Lyft is not, so I'll get my ride with Lyft"
Surge pricing is a legitimate function of a properly functioning market. When demand has skyrocketed, or supply is constrained, prices _should_ rise. This is the mechanism by which markets enable resources to be allocated efficiently. Whether someone is poor or rich, if they desire a thing more than other people do (for the sake of argument, other people of similar wealth), then they should have a mechanism by which to express that preference. That preference is the price they're willing to pay.
If the area is congested, and you _really_ want to go somewhere right now, then surge pricing gives you two ways to accomplish this. (1) To the extent that capacity is fixed, the ability to out-bid someone else means that you can take the capacity from someone else who doesn't desire it as much as you do. (2) The higher price incentivizes more supply. Uber drivers who see an exceptional surge price will make themselves available in order to take advantage of higher wages. A higher surge price is pure profit for the driver, if he can make himself available to drive right now versus some other time in the week
Lastly, no supply is fully constrained. If the price of parking in a city skyrockets, then this creates a strong incentive for parking businesses to find a way to make more parking available. This might mean buying existing buildings, demolishing them, and converting them into parking structures; or it might mean that in the routine course of building new structures, the high price of parking will make it economical to dig a few stories deeper and provide a few more levels' worth of parking. Price and incentives always influence the operation of the market.