Economics of Surge Pricing

Geoff Riley

28th February 2024

This economics video looks at surge pricing. Surge pricing, also known as dynamic pricing or demand-responsive pricing, is an economic concept where prices for goods or services increase during periods of high demand. It is used extensively in ride-sharing such as Uber and Lyft, hotels, airlines, theme parks and some fast-food chains are considering a type of surge pricing with investment in digital menu boards, which allow prices to be easily changed with some prices being set by an algorithm based on the strength of demand. Will it work?

Geoff Riley

Geoff Riley FRSA has been teaching Economics for over thirty years. He has over twenty years experience as Head of Economics at leading schools. He writes extensively and is a contributor and presenter on CPD conferences in the UK and overseas.

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