Cleaning the dishes. Raking the leaves. Writing that email to a colleague. Preparing dinner. Visiting our parents. None of these take place without our intention and action. They don’t happen on their own. These parts of our lives are more or less under our control. Sure, some plans fail. Sometimes our desires go unfulfilled. Sometimes there are unintended consequences — things happen that we did not intend. But a good chunk of our life is about making things happen that we desire to see happen.
Then there are things that are out of our control but that happen on their own through a natural process no human being intends or designs. Breathing. The healing of a paper cut. Staying attached to the earth rather than floating off into space. We don’t have to lean into the curve as we go around the sun to keep the earth on orbit. No human being is in charge of making sure the sun comes up tomorrow. When it rains, we may be frustrated if we had hoped to go on a picnic in the park but there is no one to blame. And if it’s an especially beautiful day, we may thank God or simply be glad to be alive. But there is no person we owe thanks to.
Turns out, not as much as you — and they — would like to think
A journalist once asked me how many jobs NAFTA had created or destroyed. I told him I had no reliable idea. Certainly jobs had been lost when factories closed and moved to Mexico but other jobs had been gained because Americans now had more resources and increased their demand for products that would not be easy to identify. Why not? Because thousands and thousands of jobs are created every month and it is very difficult, perhaps impossible to know which ones are related to NAFTA allowing Americans to buy less expensive goods from Mexico. I also told him that I believed that trade neither destroyed nor created jobs on net. It’s main impact was to change the kinds of jobs and what they paid.
The journalist got annoyed. “You’re a professional economist. You’re ducking my question.” I disagreed. I am answering your question, I told him. You just don’t like the answer.
In part I of this morality tale I looked at some of the effects of Uber’s surge pricing. Uber raises prices when demand is high — Friday and Saturday nights, say, when a lot of people want to drink without worrying about driving or in the particular case I looked at, after the explosion in the Chelsea neighborhood of New York City (which did turn out to be a bomb, evidently) when a bunch of people in that neighborhood suddenly decided they very much wanted to be somewhere else.
When the price of a ride increases during a time of unusually high demand, there are two effects. Some drivers who might otherwise not drive will find it worthwhile to drive. And some riders who might otherwise have requested an Uber will choose not to. They will either postpone their trips or skip them altogether.
When Uber puts surge pricing in place on a Saturday night, say, two things happen. The first is that some drivers who otherwise might sit at home enjoying life now find it worthwhile to spend time picking up people and taking them where they want to go. The second is that some people who want a ride decide to either delay their trip for a bit or find an alternative way (taxi, bus, walk, friend) to get to their planned destination. Some will decide to cancel their trip when they see the cost of getting an Uber.
These effects are particularly important when there is danger that people wish to flee. Last night in New York City there was an explosion in the Chelsea neighborhood. No one at the time knew for sure what the cause was or whether it was part of more general danger in the area. A lot of people wanted to get out of the area and get out quickly. Surge pricing encouraged drivers to face potential danger. It also signaled to potential passengers whose desire for a ride was not urgent to step aside and make room for those whose need was very urgent indeed. The beauty of prices is that these people do not have to know what is going on. The higher price sends them a message.