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Kellogg Fellows’ research reveals problems with algorithmic pricing

June 23, 2025

Research by Kellogg Official Fellows, Reuben Binns and Max Van Kleek, has attracted national media attention for its critical insights into the gig economy. Their findings highlight the unintended consequences of algorithmic pricing systems, which often disadvantage both consumers and service providers.

Reuben, the lead author of the study, and Max undertook the research with colleagues in the Department of Computer Science using a Participatory Action Research (PAR) approach. This method emphasises collaboration with those directly affected – in this case, 258 Uber drivers – collecting data from over 1.5 million trips between 2016 and 2024.

Partnering with Worker Info Exchange (WIE), a non-profit advocating for gig workers across the UK and Europe, the team conducted a participatory audit of Uber’s pay and job allocation algorithms. Their analysis compared conditions before and after the introduction of dynamic pricing in 2023.

The findings are striking. Since dynamic pricing was introduced by Uber:

  • Driver pay has decreased
  • Uber’s commission has increased
  • Job allocation and pay have become less predictable
  • Inequality among drivers has grown
  • Drivers now spend more time waiting for jobs

Reuben Binns explains: “The higher the value of the trip, the more of a cut Uber takes. So the more the customer pays, the less the driver actually earns per minute.”

The study underscores a growing disconnect between what passengers pay and what drivers receive, raising urgent questions about transparency, fairness, and accountability in algorithm-driven platforms. The research will be presented at the ACM Conference on Fairness, Accountability, and Transparency later this month.

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