It works in both directions. Tickets that were priced too high come down in price to find demand. The idea that a business should set inefficient prices for the good of society or something is complete nonsense.
Not if they were previously priced efficiently, as in cost plus a reasonable margin. No one will pay less because that would be at or below cost, but now some will pay more.
This is a specific example of prices NOT working in both directions — the airline using AI and massive data sets about the individual buyers is EXPLOITING INFORMATION ASYMMETRIES to extract the maximum payment available from each individual buyer — in exactly the situation where the buyers have no such leverage.
It would be working in both directions if all customers had equal opportunities to buy at openly known prices. The above is not an open and free market where buyers are knowingly bidding up or down prices of seats.
Maximizing exploitation of each individual customer is NOT price discovery; it is only discovery of how well they can screw each individual customer by exploiting info asymmetries and presenting skewed options.
You call it "inefficient prices". I call it "not gouging".
Imagine being a guy making just $50K/year, then you get a new job doubling it to $100K, and rather than feeling like he's getting ahead, every merchant doubled what they charged him for products and services.
We used to have a term for someone that maximized profit with zero regard for the impact on society or even their customers: Robber baron. As far as I'm concerned, what you're calling for is outright evil.
