[jedberg]

This happens to any platform using algorithmic pricing. Any time there is an unexpected event that either constrains supply or increases demand (or both), the algos go haywire. Then the the platform has to put in checks to prevent it from happening again.

Remember when Uber was new and the surge pricing could do 20X+ in just a few minutes when there was an emergency? And then they had to fix it so that wouldn't happen, the trade off being that there just weren't cars available.

The thing is, some people aren't price sensitive. In a sudden blizzard, some people are happy to pay $350 for a two mile ride home, just to get home. And some drivers are happy to go out in that weather for their piece of the $350.

The hard question is how do you find the balance?

[eviks]

> The hard question is how do you find the balance?

That's an easy question - you find the balance by letting people do what they want, then it automatically balances. Banning that, you can't find the balance because you've banned the mechanism that balances.

[jedberg]

That's the economists answer, but not the human answer. In the case of an emergency, especially one involving the sudden loss of housing in one area, economics doesn't cover the answer. If we simply "let the market do it's thing", you'd end up with only the richest people getting housing, even though they are the ones that can afford to leave the area, while leaving even the middle class and poor completely homeless.

The real answer here is to figure out a way for the people who need it most to get it, and the people who need it most aren't always the richest.

[eviks]

Besides dehumanizing economists, your "real answer" doesn't provide an answer, though that's also human...

[jedberg]

I'm not dehumanizing economists, I'm dehumanizing the particular theory I was replying to, which is "let the market do its thing". Which is a very rational and uncaring way to look at things.

And I'm aware I didn't provide an answer. I specifically said there is no answer.

[gsf_emergency_2]

You provided a partial answer.. the general idea to work out how need vs ability to pay can be reliably signalled. Don't give up! Or at least keep the idea around, until something shoes up. The general theory of auctions provides other sorts of partial answers, and it doesn't look like there are any mathematical or physical laws that forbid the kind of answer some of us would like to see. I reckon I'm not dehumanizing anybody here :) this is more interesting than imo problems, you might not even want to ask LLMs because that'd make it boring-er. Uber and Airbnb would have peeps on this if they do care*!

Edit: the same basic problem appears everywhere, e.g.

-*the need to make money exceeds the ability to solve general problems

-your need to understand exceeds my ability to explain

-my ability to focus exceeds your need to continue this thread

-healthcare insurance ie try to get tptacek on your side

[eviks]

But you're the only one doing dehumanization! The theory is "let people freely do their thing", why do you speak like an economist and replace humans with markets? Where does the lack of care appear?

[guelo]

That's capitalism in general, the moneyd get the cream of all crops while the rest of us fight for the scraps. The only respected virtue is unadulterated greed.

[scoofy]

It's a hard question because we don't live in Anarcho-Libertarian society, and we have laws.

The issue isn't "what should we do here," which is a political question, for whom each person will have their own answer. The question is what do you do about a "we're just a venue, we're not actually conducting business" company that is very clearly facilitating mass-violation of laws.

This undermines rule of law, simply because our legal system isn't designed for centralized vehicles for criminal behavior, without being able to charge the catalyst for the behavior, the app, with penalty such that it compels behavior going forward. Facilitating these crimes is criminal behavior.

It's a tough question, both politically, and practically. We like the idea of AirBnB, but if we can't find a way to create an enforcement mechanism for local hotel rules, then we're basically endorsing lawlessness... which isn't politically sustainable.

[msgodel]

It's a tough situation mostly because you've decided to reject reality.

Let people sort it out, they know what's going to work best for them far better than you.

[scoofy]

Again, what you think should happen is just more politics.

[Tadpole9181]

Extorting an emergency and telling someone they either pay upwards of their entire life savings or die is not acceptable. There cannot be a free market in short term, life-changing moments there's no time or deliberation or competition that capitalism requires to find "balance".

[eviks]

> entire life savings or die is not acceptable

Making stuff up for dramatic effect is also not an acceptable argument.

> there's no time or deliberation or competition that capitalism requires to find "balance".

That's not a requirement, but also there is time and all that- otherwise how did the people manage to use airbnb in the first place if they had no time? And you can deliberate for 5 minutes looking at a very high price and decide that you can temporarily stay in a much smaller place and further away than you wanted/used to. Or maybe move to your friends /relatives instead

[Tadpole9181]

The argument is there should be no balance, I am absolutely allowed to use worst-case. There is a reason it is illegal to price gouge water in emergency situations.

That law, like many, is written in blood.

[eviks]

> The argument is there should be no balance.

No, there is a balance, you've made up an argument

> I am absolutely allowed to use worst-case.

And I'm allowed to call out this faulty rhetoric

> That law, like many, is written in blood

That law, like many, is causing blood. It was the same thing with masks - instead of incentivizing people to drive far away to get masks from places of low demand and move them back to the city with high deficit, the FBI cracked down on gouging grounds, leaving people in cities exposed to the deadly virus without a mask.

[Tadpole9181]

> No, there is a balance, you've made up an argument

Don't fucking gaslight me like I'm illiterate and can't look up three damn messages. You literally said that there should be no controls, ergo no balance between free market capitalism and controlled emergency economy.

Talking with people like you is such a waste of time.

[Y_Y]

The sellers are definitely price-sensitive though. The choice isn't between a $350 trip and a $20 one (because demand far outstrips supply at the point), it's $350 or no deal, or at best a lottery ticket to see if you're one of the lucky 5% of people who can get a ride at the old price.

When the rate shoots up like this drivers will get a message, and plenty of them will get out of bed or stop whatever they're doing and get on the road. The platform will probably take a nice cut, but otherwise to meet demand they'd have to subsidise most of the difference. That would be some very expensive PR.

[thaumasiotes]

> The thing is, some people aren't price sensitive. In a sudden blizzard, some people are happy to pay $350 for a two mile ride home, just to get home. And some drivers are happy to go out in that weather for their piece of the $350.

> The hard question is how do you find the balance?

Why is that a hard question? What balance are you looking to find?

[jedberg]

Allowing those who are willing to pay any price to do so while still serving the community by not price gouging everyone, especially those who are price sensitive but are still desperate.

[hibikir]

When the supply of something is lower than the number of people that are price sensitive and desperate, capping prices will still leave desperate people without what they want. Many mechanisms that appear to be more fair, like free lotteries, end up distorting things in other ways: If it's a free lottery, you bet people will sign up without being desperate.

One might have an aesthetically favorite version of deciding who is going to go without, but there's always going to be a problem with just that. What really helps is increasing the supply of what people want. And for that, it's hard to beat increasing rewards to the suppliers.

[adammarples]

Don't high price signals in an efficient market serve the community by increasing supply? It's hard to argue that there's a better way to do it that doesn't inadvertently decrease the supply and instead become a lottery

[redserk]

I think this would rely on an assumption that there is always supply available to draw on.

At some point there is no supply to alleviate the problem. Some effects may be dampened by new ride share drivers signing up, but even then, not everyone wants to be a driver regardless of compensation.

I don’t know of a good approach to free-market around a supply limitation in the short-term.

[hibikir]

Prices cannot solve all supply problems. We cannot have 2 million teenagers dating the starlet-du-jour. But prices typically can increase the supply quite a bit, while most techniques that avoid prices will not increase supply at all.

So if the goal is to maximize how many people get what they want, prices, plus some mechanism to avoid temporal speculation (for instance someone saving their sealed pokemon cards for 20 years hoping for price increases) makes the most sense.

[luckylion]

That's unlikely for sudden and short-lived surges, isn't it? There probably won't be plenty of new rentals popping up in LA because of potentially high demand during the next wildfire.

[eviks]

People can drive from other locations without setting up a rental

[thaumasiotes]

That is an incoherent, meaningless sentence. You think people should be allowed to pay high prices, but no one should be allowed to accept their money? What do you think it means to be allowed to pay for something?

[dontlaugh]

Why would you cater to those willing to pay any price? They’re a tiny minority of people.

[more_corn]

So correct me if I’m wrong but Airbnb does not recommend a price. Theres no “algorithm” Nor do they review prices. You could post a place for $1million a night and they won’t notice or care. It just won’t get rented.

[jedberg]

They recommend a price when you list, and they de-emphasize your property in listings if you don't fall within the recommendation.

[bko]

> The hard question is how do you find the balance?

If only there were an entire field of study dedicated to matching supply and demand to maximize utility while encouraging efficient resource allocation...

[renewiltord]

It happens all the time, actually. It's what happened to Gamestop. A few people really wanted the stock and the price just shot up. The worst was the Reddit IPO. The price just kept going up and the Reddit team sold stock at high prices instead of serving the community. It's just greed.

People should not be allowed to sell except at the government-mandated price. Of course, a few million may starve, but that is a sacrifice I am willing to make in order to serve the community.

Hopefully, we can make this Great Leap Forward in consumer rights, and prevent Late Stage Capitalism from having a Mask-Off Moment in AI slop enshittification. If you disagree, I'm begging you to read a book. Tell me you're enabling corporate interests to cause trauma without telling me you're enabling corporate interests to cause trauma.

[stingraycharles]

Highly dependent upon circumstances, the government should really only regulate prices on a few things and that’s it (ie essential needs such as healthcare and energy, which is the case where I’m from).

Having government mandated prices for everything is a very silly approach.

[mike_hearn]

The post you're replying to was being sarcastic.

[stingraycharles]

With the current state of the internet and the absolute nonsense I’ve seen people write online I didn’t catch that, so I apologize for not catching that.

[renewiltord]

I think your earnest response was actually a good way to engage.

[renewiltord]

Another essential need is video games and Internet, without which most people cannot survive. Today's people also need access to the AI companion Ani part of the Grok 4 character suite built by x.ai. But we can solve the latter problem by just providing everyone with a $100k/year budget to spend on companionship. Mental health is health. Other platitudes available on demand. If you like, I can also use LLM to say such platitudes in the drawn out style of OP comment so that everyone can gather around and participate in game of Woe The Capitalist. Great enjoyment.