The Morality of Dynamic Pricing

I recently commented on a very good article by a friend of mine (Chris Taylor, see http://lnkd.in/bCKsVDB) regarding the Internet of Things and the effect that it might have on pricing. Specifically, the possibility of applying realtime, dynamic pricing to a broader range of products and services. I am blogging my comment, because I think it bears repeating: The availability of *big data* and the kind of distributed processing that allows us to operate in a much 'smarter' capacity runs the risk of us over-applying more sophisticated methods to interactions that, in my opinion, should remain patently unsophisticated for moral and practical reasons. Here is the comment: "Aside from the econometrics of pricing, there is also a moral question, which, I think, is further accentuated by the ever increasing bipolar disparity in income and wealth - not just in the United States, but the world at large. In today's world, the person who makes $5/hr can still complete for a cup of Starbucks coffee with the person making $40/hr, just by virtue of standing in line to pay a predetermined price. In, potentially, tomorrow's, realtime 'price elasticity' world, the $5/hr person may very well be priced out of that cup of coffee when they get to the front of the line, just by virtue of the accumulation of people at the back of the line. In cases where real, long-term planning cannot be effected by the purchaser of a specific good or service - i.e. buying an airline ticket or booking a hotel - the moral question of realtime dynamic pricing is a very interesting question indeed, especially when one has already paid a real price in terms of time spent waiting to effect the transaction. As a society, we'll need to take care to make sure we don't create dynamic models for interactions that should morally and practically remain static. It would really suck if 2015's Valentine's Day dinner were based on realtime data of 2014's post Valentine's Day dinner climax ... Or maybe not ;-)"