Why is this rated 5? Yes, paying drivers more *might* slightly increase supply but my guess is that the number of drivers is somewhat
You guess? Well lets just throw out the Iron Clad Law of Supply & Demand, on which almost all of the worlds productive economy is based, because you guess.
fixed so without also charging passengers more you do nothing on the demand side. The point of demand pricing is to reduce demand
so that you don't overwhelm the relatively fixed supply. If your goal is to always have cars available, then increasing the price while
paying the drivers the same would actually be a better solution than increasing the pay while charging the same but that would also be
You cannot look at one side of the equation.
When demand is up, there are only two options. Option number one is shortages (of supply). Option number two is that supply must increase.
When supply is down, there are only two options. Option number one is shortages (of demand). Option number two is that supply must decrease.
In either case, the solution is price elasticity. When the price drops, because supply is too high or demand is too low, drivers will drop out of the market. When the price raises, because supply is too low or demand is too high, drivers will enter the market.
Uber has a flexible work force, and it is no way fixed. They also posses 100% more information about the market and their drivers than you do, or the AG does.
This is the case of government using consumer protection laws in a way that will hurt consumers. Economics and the market are not friendly, but they do produce desirable outcomes. If the desirable outcome is fairness, than what the government and AG are doing will produce a fair outcome - everyone regardless of ability to pay will have an equal chance of getting or not getting a car, based on random luck, your skin color, or whatever else motivates you.
If the outcome is to provide as many rides possible, this requires a market with supply and demand efficiency. By curbing supply efficiency by limiting price elasticity, you provide fewer rides than the market will optimally support. If you are frequent driver, you know that by going to where the demand is, to when the demand is, will produce more and more profitable rides. If you are a rider, you know that by relying on Uber during exceptionally busy times, you will only be able to get a ride by paying far more than you would otherwise.
This is really a great case of the nanny government stepping into a situation which is drastically over it's head, in the name of "fairness". Fairness is not an economic goal, it's a social goal, and it's stupid to try to enforce a social goal like this on the very tail end of the policy stack.