Towards a Two-Sided Market on Uber

17 Jun

Uber prices rides based on the availability of Uber drivers in the area, the demand, and the destination. This price is the same for whoever is on the other end of the transaction. For instance, Uber doesn’t take in account that someone in a hurry may be willing to pay more for a quicker service. By the same token, Uber doesn’t allow drivers to distinguish themselves on price (AirBnB, for instance, allows this). It leads to a simpler interface but it produces some inefficiency – some needs go unmet, some drivers go underutilized etc. It may make sense to try out a system that allows for bidding on both sides.