Everyday Peeple

Forget Parcheesi. Bayesian games are proper fun for the whole family. In a Bayesian game, one (or both) players doesn't know what type of person the other is. This is important because play will vary depending on the nature of your opponent. If you face the decision about whether or not to be the tough guy in a barroom confrontation, it's in your best interest to know whether or not the other dude can mop the floor with you. By reverse induction, it's therefore wise in such situations to signal to others that you're tough, or crazy or dangerous. This is true whether or not you're actually a badass. Acting tough in a barroom brawl game is therefore a pooling equilibrium. Contrast this with, say, the automobile market. A '31 Duesenberg Phaeton gets a motorist from Point A to Point B roughly as effectively as an '86 Yugo (provided you can find one still in working condition), yet for the price of one Doozy ($1.4M at auction), you can buy close to 1500 Zastava Korals (again, provided that many exist in the wild. A Dusenberg isn't 1500 times as efficient at transporting humans, so the price reflects something else about the owner. This is a separating equilibrium.

For most existing Bayesian-type games, we have pretty well-established heuristics about what to expect and how to play. We know when to be sincere (the marriage game) and when to be strategically dishonest (the dating game). But that's for well-established, properly-understood situations.

Meet Peeple, aka Yelp, but for humans. Yes, yes: the idea was stolen from either Dinosaur Comics or SMBC, depending on whether you ask Ryan or Zach (I do so hope they duke it out in the comments [they won't]). So far, most of the press has been pretty unkind. It's easy enough to imagine anonymous vandals ruining moderate-to-high profile people's reputations with relative ease and impunity. If this happens, the sensible response from folks with chronically bad ratings is to poison the well, so to speak. That is, if a separating equilibrium arises, where actually awful people tend to accumulate negative reviews, then those awful people will have an incentive to sock-puppet up and leave piles of negative reviews on the profiles of their rivals, thereby creating a pooling equilibrium where everyone looks awful. Sort of like Encyclopedia Dramatica, but with less fun and imagination.

Still, I think it'd be a nice experiment to see what sort of Bayesian game arises. Recall that some Bayesian games have no pure dominant equilibrium strategy. If I were a betting man, I'd say that there would be some chaos (pooling eq) among second-tier culture warriors, but most other folks would enjoy more-or-less accurate ratings. If I were a betting man.

Edit: the above assumes that the proposed venture isn't merely a silly hoax (pr ~.6)

 

Shadow Prices in a Toy Economy

I spend a lot of time thinking about prices. Probably more time than is good for me. My first Big Boy Pants price theory was hand-delivered from an out-of-press Alchian and Allen Exchange and Production (nb, the top billing that "exchange" enjoys in the title is something regular readers of EE will appreciate) via Walter Williams. But graduate level Microeconomics I was hardly the end of my obsession with the subject. Cost and Choice, a breezy little treatment by the late James Buchanan and the occasional lecture by our own Mike Munger also top the list of influences. It was Buchanan that got me thinking of subjective value (though I think my pals at Sweet Talk might prefer to call it conjective value) on both the consumption and the production side, and it was Mungo who urged me to think carefully about the wide range of opportunity costs and the many otherwise unnoticed frictions of ordinary commerce.

I recently had a Munger Moment visiting Colonial Williamsburg with my niece who is visiting from Lithuania for the month. If you've not been there before, it's a working recreation of the actual 1750s era town, complete with brickyard; milliner; cooper; baker; forge; foundry; loom; smiths tin, black, and silver; & sundry. There's even a dedicated period-appropriate toolmaker who uses modern equipment to craft the tools used by the on-site artisans using the same steel that would have been available at the time. The bit that intrigued me started at the brickyard. While the barker was giving his pitch to the punters, I tugged the ear of one of the other folks working there to ask her why the sundried bricks had what appeared to be a cattle brand on it. She explained to me that the bricks they fired there in the traditional style were actually used on-site for repairs, renovations, and for new projects. Since they were obliged to be period-accurate, they have to distinguish the brick sizes on account of everything predating the standard 220/73/106mm dimensions in use today. Moreover, despite being a tourist attraction, they're one of the few brickyards in the US to use traditional firing methods to create non-standard bricks, so folks owning old brick homes in historical districts often buy from them, especially if they need to replace vitrified or hot-fired bricks.

My curiosity rose as we visited further. At the tinsmith, we discovered that not only were wooden mallets, fids, hods, and scrapers produced on-site, but a great many other easily-manufactured goods as well. It's pretty tough to work with tool steel when you've got a foot-cranked grinding wheel, but cast iron is easy enough to work in the style of the period. Much of the cookware comes right out of the foundry on site. Costumes too, even if the fabric is imported (which is also period-appropriate, since Virginia only grew the cotton; all the textile mills were either up north or across the pond). The really interesting bit was when I saw that some of these same goods used and manufactured on-site were on sale in the gift shops. So between the bricks, the tricorn hats with or without cockades, the wooden dice games, the horseshoe puzzles, and the rag rugs, there are three market tiers: a wholesale market (bricks sold to homeowners in Old Town Alexandria), a retail market (hurricane lanterns in the gift shop) and a shadow sharing market (can you fix my solder oven? I'll owe you a favor later).

Now, ordinarily, we'd just impute the formal market price to the shadow market to determine what the opportunity cost of this local sharing economy is, but casually watching it in action on a lazy summer afternoon gives me pause. I think there's a little something else on the balance sheet in the trade between the park employees that doesn't exist across from a cash register. I think some of it is what the accounting trade calls "goodwill," but I also think there's a special residual for cases like these that rely heavily on in-group aesthetics. You probably already know the literary trope that has the plucky hero earn the "special price just for the family" thanks to some courageous act of derring-do. There's some truth to that. Cherished in-groups enjoy a favored-customer status. Some of it's probably because of reputation effects, but I suspect a lot of it is just atavistic clannishness. I'm a little out of the loop on the current experimental econ lit, but I imagine that you could test it pretty easily in the classroom. Randomly assign folks to a blue team and to a green team, let them trade within their team for a while, then let them trade with each other. My hypothesis is that Team Green will charge higher prices to Team Blue members, and I also suspect that this effect will intensify when the objects traded are more tangible and personal (cups or sweaters in contrast to financial instruments or tokens).

I didn't press the girl in the tinsmith shop to elaborate on the economic institutions (my niece was a little tired and footsore), but if I'd had the time I think I would have asked her to describe the local economic system. I think she would have gone with "communism" or some variant, because she was about half a syllable from uttering "from each according to his ability, to each according to his need" (REMINDER: Marx didn't write that, he just popularized it). And I think there's some merit to that. I also think there's a great deal of merit to Bastiat's counterclaim that while you're wearing the 18th c. duds, it might be easy to overlook that Colonial Williamsburg is still just a tourist attraction. It's embedded in the institutions of the 21st c. Without the external prices listed in the shops, the tough decisions of "what shall I produce" and "for whom shall I produce it" are nigh insoluble. Without the residual ownership of the entire enterprise, and the motivation of being a colonial-era theme park that exists to entertain tourists, can you imagine that a bunch of college-aged kids would show up to sew breeches and bake bread for each other?

Like I noted with one of my favorite old posts here, barter, gifts, truck and other lesser forms of commerce are at their most euvoluntary when the alternatives of impersonal, anonymous exchange are also available. I'm coming around to the argument that the new sharing economy (Uber & al) merely reinforce those same moral intuitions. People really like to share, to be a part of a community rather than one cog out of many. Humanity isn't merely eusocial, it's social as well. The app-driven sharing economy allows us to be both at once. And I don't know about you guys, but I think that's pretty awesome. Uber, except for the day-to-day commerce of a model local economy.

Uber, but for Police Harassment

It's a bad day to be gullible on the Internet, so accept the possibility that this is a finely scripted prank.

Wars on multiple fronts are difficult to coordinate. This is as true for culture wars as for ground campaigns. Here, we evidently see crossfire from multiple battlefields. An interesting artifact.

Uber is not euvoluntary. Neither is immigration. Neither is the contract between the agents of the sovereign and the constituency.

This machine produces outrage and its effluvium is death. Or maybe the other way round. It can be hard to tell at times.

Yo, but for Help.

I may have elided some of the statutory challenges of crowdsourcing ARNG emergency response. Part of the problem is sending out uniformed guardsmen on official duty, but that's [probably] small potatoes compared to gassing up a deuce and a half or a Stryker and sending it out to pick up stranded civilians. After all, Guardsmen are part time, and are generally at liberty to help the public or not at their discretion, and there's certainly no dishonor in doing so while clad in BDUs. There is no such liberty for Guard materiel.

Recall that the underlying problem we wish to solve is how to deploy appropriate equipment and personnel to emergency situations. For evac in the midst of danger, Uber took some heat for using surge pricing (even though they later reimbursed passengers) during a hostage situation in Australia. You might imagine similar instances arising from municipal fires, earthquake, or tsunami. Folks caught in a perilous situation want courageous people to run towards danger to help them. One way to do this is to pay ordinary civilians a premium. Another way to do this is to mobilize National Guard resources. Yet another way is to pre-select volunteers for non-specialized emergency response. You don't call 911 for a ride home in the middle of an incipient riot, but who should you call? There might not be enough money in your account to get an Uber driver to show up if he thinks his car is going to be the target of an angry mob.

But a retired marine might rush in where a college kid looking to make a few extra bucks on the side would fear to tread.

By signing up to be a Help!™* driver, you agree to assist people in distress. You won't be expected to provide law enforcement or medical assistance, nor would you be expected to prevent property damage or anything extraordinary like that. You simply agree to get people out of a pickle if they ask. It's like AAA, but not just for roadside assistance.

What do you guys think? Good idea? Bad? Too easy to game? To difficult to price? Unstable equilibrium? Recall that the BATNA is simply the status quo: otherwise well-intentioned yet courageous people simply sit at home in relative ignorance, either watching from afar or having no idea that there are people in need of help.

Or is it the case that anyone in an emergency situation is always facing a dire BATNA and the only "moral" price is always and everywhere zero?

*not an actual trademark... yet

Uber, but for Title 32 Mobilization of Army National Guard and Reservists

Uber makes the news yet again when surge pricing kicked in after the recent Sydney siege. Responses have been fairly predictable. Gawker ran (another) smear piece, offering arguments lifted nearly word-for-word out of the EE corpus: it's simply wrong to charge extra during an emergency situation. I'll let Russ Roberts counter:

People should do the right thing. But if they don't or if they don't even know what the right thing is, sometimes prices help.
— Russell Roberts (@EconTalker) December 15, 2014

Sometimes prices help. Sometimes.

If you'll indulge me, I'd like you to consider for a moment what the underlying trade is here. Ignore the livery branding and what we have is a dangerous situation that bystanders need to flee—need in the sense that their BATNA could be disastrous if not fatal. Asking strangers to ferry folks away from danger is great, but unless you make it worth their while, consider that the answer might well be "no." Remember that most folks sensibly run away from danger.

Most folks.

If only there was a well-funded organization with the expertise and equipment needed to perform the dangerous task of evacuating civilians in emergency situations (apologies to Garett Jones). If only this organization already pre-selected for the type of people who intentionally run into danger. If only this organization enjoyed the sort of longevity encoded into the highest law of the land (Article I, §8; Clause 16), allowing for intertemporal resource allocation smoothing. You've probably already read the title of this post, so you know to which organization I refer. The problem with using Uber drivers to evacuate civilians in emergency situations is that Uber drivers are also civilians. They're generally not trained to deal with extreme situations, and they've not already pledged to put themselves in harm's way. Guardsmen have. Furthermore, your local armory probably has a deuce-and-a-half or two gassed up and ready to roll. The ARNG is the ideal organization for civilian evac.

Unfortunately, individual constituents are unable to invoke Title 32 mobilization by their lonesome. Only the governors of the 54 states, territories, and districts can do that (50 states + Washington DC, Guam, Puerto Rico, & the US Virgin Islands). So an app to call out for your local 88M to pick you up directly probably won't be forthcoming. But something to quickly and directly notify the governor's office is probably fairly reasonable. Think Yo, but with a few extra bits of information, like geodata, type of emergency, number of affected civilians, status of emergency (ongoing, etc). That sort of thing. By quickly crowdsourcing all the relevant characteristics of the emergency, supplemental responders can more rapidly coordinate an appropriate response.

If the problem is, "we need more people to run towards danger to help" then adding a surcharge to a peacetime livery service is one way to get there. But it ain't the only way. Before we set to thrashing Uber for their particular solution to a thorny problem, let's consider some other reasonable alternatives.

Big Bad Heteroskedasticity: Bezos vs Krugman vs Andreessen Edition.

Paul Krugman accuses Amazon of asserting monopsony power by pressuring publishers to reduce prices, likening Jeff Bezos to J.D. Rockefeller.

Does Amazon really have robber-baron-type market power? When it comes to books, definitely. Amazon overwhelmingly dominates online book sales, with a market share comparable to Standard Oil’s share of the refined oil market when it was broken up in 1911. Even if you look at total book sales, Amazon is by far the largest player.

The econ 101 explanation is in the following graf:

So far Amazon has not tried to exploit consumers. In fact, it has systematically kept prices low, to reinforce its dominance [that's one hypothesis, anyway -SLW]. What it has done, instead, is use its market power to put a squeeze on publishers, in effect driving down the prices it pays for books — hence the fight with Hachette. In economics jargon, Amazon is not, at least so far, acting like a monopolist, a dominant seller with the power to raise prices. Instead, it is acting as a monopsonist, a dominant buyer with the power to push prices down.

Amazon is a mancgere, a merchant that neither improves nor alters its wares, but rather offers the conveniences of transporting goods from seller to buyer with as little fuss as possible for buyers. By being the largest middleman, Amazon is (ostensibly) able to extract monopoly/monopsony rents on multiple margins. If you're a publisher, your BATNA is to try to get books out in tottering brick-n-mortar joints. If you're a reader, maybe you can look around for a pirated .pdf or something (hands up if there's a Barnes & Noble in a 20 minute drive of where you are right now, let alone the good ol' mom and pop book store).

What's more, their very size allows them the luxury of discriminating on multiple margins. Krugman identifies an editorial margin related to partisan politics and delivery times:

Last month the Times’s Bits blog documented the case of two Hachette books receiving very different treatment. One is Daniel Schulman’s “Sons of Wichita,” a profile of the Koch brothers; the other is “The Way Forward,” by Paul Ryan, who was Mitt Romney’s running mate and is chairman of the House Budget Committee. Both are listed as eligible for Amazon Prime, and for Mr. Ryan’s book Amazon offers the usual free two-day delivery. What about “Sons of Wichita”? As of Sunday, it “usually ships in 2 to 3 weeks.”

I'd add that you don't even have to reach that far. One of the unintended upshots of the fragmented local book markets is that micro-markets could thrive. As other-Sam notes, the content curation issue is extremely important. Book store owners anticipate customers' purchases, and stock the shelves accordingly. This sends production signals back to publishers to tell them the sort of talent they should be scouting. These days, the signals are chiefly coming from a single retailer. If this retailer is non-neutral, future content could be skewed. If this retailer rejects tail risks, future content could be leptokurtotic. Either one of these is unjust, especially for our descendants.

Krugman recommends swift government intervention. I do not. A wise and benevolent sovereign might remedy the content curation problem, but wise and benevolent sovereigns are sadly in short supply. An agency chartered with the sort of authority required to monitor the business operations of a bookseller of all things is, in other regimes, called a "censor." The question the careful analyst (and entrepreneur!) should ask is: "is there an alternate institutional arrangement that would solve the problems of content curation, monopsony coercion, & al without creating greater systematic risks?"

I think the answer is "yes." At the risk of being glib, consider an Uber of books; a bitcoin of books. Or of any non-durable consumer goods. Amazon provides a centralized service. They're so large because they're able to cheaply solve the very difficult problem of how to match buyers and sellers. This problem can be solved in an algorithm, perhaps on the blockchain. Warehousing and delivery are entirely separable from the core competency of Amazon.

Is Amazon euvoluntary? I guess the answer depends on what you want to compare it to.

See Marc Andreessen's commentary here.

h/t the ST Gang

Of the Division of Tariffs

It is a consistent source of man's wonderment the many ways in which mutually felicitous exchange is made. Consider the curious case of the two-part tariff. A two-part tariff is when the customer pays a periodic fixed fee, often in exchange for lower piece-rates. Unless the firm is a protected monopoly, in which case the first part of the tariff (sometimes hidden in public expenditures) aids in the extraction of monopoly rents. Part of the recent dust-up between taxi organizations and ridesharing services have exposed something curious about the multi-part tariffs bound in livery.

The Dub-MOE and I hinted at some of the demands that Birmingham is mulling w.r.t. Uber, Lyft, Sidecar et al. Among them is a requirement for an extra $500k in liability coverage, borne by each driver.

The by-driver requirement specifically set my hackles up. I'm already alert to Yandle's Bootleggers & Baptists story, so I've a keen nose for mischief when it comes to pronunciations from professional taxi organizations, but the peculiar thing here is that while other aspects of taxicab livery could run like a protected (local) monopoly, it seems unusual that the insurance industry, itself highly protected via regulation should be complicit. In other words, why would taxicab companies not have full mutual insurance rather than piecemeal coverage?

Please recall that the purpose of insurance is to guard against idiosyncratic risk. For ordinary drivers, this means pooling with all other drivers of your type and based on many long years of ongoing statistical analysis, with careful retrospective studies of relevant characteristics, you protect your own private assets against adversity. But for taxi services? The residual claimant should be the one footing the insurance bill. The regulatory kayfabe I've been hearing from taxi associations are all aimed at protecting the interests of the customer, and I can't for the life of me understand why this should place an extra burden specifically on the drivers. In a suit, the firm would be named as primary litigant (Ken can correct me if I'm wrong here, I know he secretly reads EE, even if he'll deny it till he's blue in the face). So the histrionics about drivers getting extra coverage must have something else under it, otherwise it'd be transparent rent protection, and even Florida sugar cartels have more sense than that.

So is there a behavioral reason? Perhaps part of the point of lading drivers with their own insurance payments is for the "Peltzman Effect", in which risk abatement is greeted with marginally riskier behavior. The standard image for this can be found at Eric Crampton's blog Offsetting Behaviour—a steering wheel with a spike sticking out of it is one way to get drivers to compensate for all those wonderful airbags that surround and cushion them. Theoretically, if someone else is picking up the tab in case you get in a wreck with a passenger in the back, you'll be (again, marginally) more inclined to take a chance on a freshly-red light, or to text your sweetie behind the wheel, etc. But this is, of course, ultimately an empirical claim, and the subjects under study for the original Peltzman Effect literature weren't Uber drivers: they didn't have the countervailing effects of driver rating systems. Direct customer feedback can more easily match passengers' risk tolerance to the specific circumstances of the road on that particular day. It's a curious conceit to claim that there's a public interest in this small-scale negotiation, other than the safety of other drivers and pedestrians (beyond existing statutes against reckless endangerment, that is).

So what do you think? Is it reasonable to insist on additional two-part tariffs for Uber drivers or is the indemnity insurance already offered by the firm sufficient? Why or why not? How would you test the claim? Please show your work.

Michael Munger on the Sharing Economy

This week's Econtalk is another entry in the Roberts/Munger hit parade. The topic: sharing. There's a bunch of new ways to reduce ancient search problems: I need a place to stay for the night, you have room for a lodger. Let's get together and make beautiful music.

Mike and Russ spend a bit of time talking about what Gordon Tullock called the "transitional gains trap", which is the thorny problem of what to do when special privileges are threatened by alternative institutional arrangements. In this case, hotels are threatened by airbnb, taxis by uber, municipal governments by monkeyapp, etc.

Tullock's recommendation: set no transitional gains traps.

It's great advice when you're considering new political privileges, but it provides little guidance after the fact.

Hence the puzzle: should taxpayers bail out people who spent a million bucks on a taxi medallion? Why or why not? What constitutional provisions (lower case c-constitution) can prevent governments from setting new traps? Is there an easy solution?

How do we clear the way for more and better euvoluntary exchange? Suggestions welcome.

The Sharing Economy

I've been getting quite a few flames from folks, for varioius provocations, mostly deserved.

Much of it from the podcast at EconTalk, on "the sharing economy."

One reader asked whether there was anything that was profitable that I would still say should perhaps be regulated.  Of course, one answer is pollution:  a business that took toxic waste, charged some amount to dispose of it, and dumped the stuff in the river, untreated...that would be bad.  You can say it's because property rights to the river are not well-specified, and okay, that's right.  But the point is that the "profits" are just rents, collected because the person is unscrupulous and charges less than rivals who treat the waste and make it safe before putting it back in the environment.

Here, though, is a stumper.  And I want to ask the EE crowd:  Is this a legit business?  Book up all the reservations at restaurants, and then (re)sell them?  (They say "one table per restaurant," but c'mon...) Like ParkingMonkey App, but for restaurant seats?

I think it's a bad idea.  I'm not sure exactly why.  Can you help?  Or am I wrong, and this is fine.  I don't mean "legal," alone.  I mean, is this morally acceptable?  Is it efficiency enhancing?

Of the Rhetoric of Disruption

A lengthy lament by Alex Payne, ostensibly aimed at Marc Andreessen, has been making the rounds. It's a good example of how rhetoric both reflects and attempts to sway the moral sentiments. viz. [links omitted]

We could go back and forth all day on what exactly defines technological change – I certainly have before. But what labor wants is self-determination, not a slowing of technological change. Taxi drivers protesting Uber aren’t saying that they want apps out of their cabs. They want leverage to negotiate wages and working conditions so they aren’t barely scraping by. The pushback is on exploitative business models, not technology.

Indulge me if you will, a bit of if-by-whiskeyism of my own here.

My friends, I had not intended to discuss this controversial subject at this particular time. However, I want you to know that I do not shun controversy. On the contrary, I will take a stand on any issue at any time, regardless of how fraught with controversy it might be. You have asked me how I feel about Uber. All right, here is how I feel about Uber:

If when you say Uber you mean the price gouger, the unregulated scourge, the bloody monster, that displaces divers, undercuts unions, flaunts licensing requirements, creates misery and poverty, yea, literally takes the bread from the mouths of little children; if you mean the evil livery service that dares charge extra in the midst of a snowstorm when riders are at their most desperate, bilking passengers for more than the value of a ride while robbing honest drivers from an honest living at a fair wage, then certainly I am against it.

But, if when you say Uber you mean the convenience of being able to catch a ride when none other would be available at any price, the transparent two-way rating system, the app that is accessed when the yellow cab is delayed, that overcomes the transitional gains trap of long-capitalized barriers to entry, and connects drivers with passengers without paying tribute to rent-soaking third parties; if you mean freedom of association; if you mean the right of the sovereign individual to peaceably conduct contract arrangements on mutually agreeable terms; if you mean the service which enables a man to move swiftly and comfortably through an alien city-scape, and in his own home town to have the freedom to help others in kind, and to forget, if only for a little while, the great tragedies brought when men of business meet with their own interests well above those of the common man; if you mean that app, the use of which frees untold millions of dollars, which are used to provide tender care for our little crippled children, our blind, our deaf, our dumb, our pitiful aged and infirm; to build highways and hospitals and schools, then certainly I am for it.

This is my taxi stand. I will not retreat from it. I will not compromise.

Negotiating tradeoffs is hard. It's made much easier when we remember that the economic puzzle isn't how to maximize the welfare of one class of people (particularly at the expense of another), but to discover those technologies and institutions that better permit people to engage in mutually beneficial, peaceful, consensual production and exchange. The economic puzzle is how to maximize cooperation. I think Andreessen understands that. I'm not sure Mr. Payne does. It is my hope that my readers do. Good luck, and ride responsibly.

Uber, Round the Third

Good Neil Irwin piece in the Post.

He brings up a great point: customers don't get pissy over still-profitable deep discount sales at retailers. Would Uber be better off if they called their surge prices the "normal" price and the rest of the time a "discount"?

Or are framing effects like this too cheap and gimmicky to fool even the economically illiterate?

Uber: Mensch or Schlemiel?

This is an interesting take on Uber "surge pricing."

It is entirely possible that the policy is good economics, but bad business practice.  That is, being without a ride is something people will accept more readily than having a ride, and deciding whether or not you want to pay that price.

Note the difference:  if there aren't nearly enough rides, the price for most people is infinity:  NO. CARS. NO. RIDES.  NONE. 

So, what people want is much lower prices for the rides that they can't get.

What everyone ignores, willfully ignores, is the supply response.  I'm sitting home, watching TV.  Lots of choices on cable, none of them good, but all better than going out in a snow storm and driving in Manhattan.  Do I go out?

Only if I expect to make enough money to encourage me to incur the risk, and the discomfort.  The high price increases the number of rides available.  How high "should" the price be?  I have no clue.  High enough to reduce the price from infinity, which is what people people who fetishize price gouging seem to prefer.

In their imaginary world, they go out to the curb, it's snowing hard, and they wave.  A cab appears, and they get the same fare as if it were Sunday morning at 6 am and sunny.

It just doesn't make any sense.  But as the article notes, consumers HATE having the option to take an expensive ride.  They hate it much more than having no ride.  Is Uber obliged to validate this lunacy, to stay in business?

The fact that "price surge" is against the law is not really relevant.  New York has been conducting "legal" but immoral stop and searches for the crime of "walking while brown" for years.  So don't give me "illegal."  Bah, humbug!