Is Algorithmic Personalized Pricing Unjust?

This contribution addresses the issue of justice in algorithmic personalized pricing by considering complex social interactions and determinants necessary to arrive at a conscientious ethical evaluation—hence, arriving at the conclusion that the burden of proof for the ethicality of algorithmic personalized pricing requires a reversal. Instead of assessing algorithmic personalized pricing as prima facie ethically neutral, I propose that there exist ample reasons to doubt this. Simply put, algorithmic personalized pricing is likely forcing consumers to engage in price-sensitive consumer behavior and share the respective data used to infer the consumers’ willingness-to-pay. However, data suggests that it is the most vulnerable that typically lack the resources to engage in long-term planning as well as careful and time-intensive price-sensitive consumption. In addition, algorithmic personalized pricing transfers some of the competitive action away from businesses and onto consumers if price-sensitivity is assessed in relative terms between customers. Such practice is likely to exacerbate inequalities and put those without the resources to engage in such competition at a further disadvantage.