When you self-check-in to United Airlines, they make a series of offers where you can upgrade to Economy Plus, get an aisle seat etc.

Why do they do this at the last minute?   They are already experts at price discrimination but this usually occurs when you buy a ticket using advanced purchase, cancellation fees etc to separate out different buyers with different willingness to pay.   You could do the same with aisle seats and Economy Plus.

Implementing price discrimination at the last minute helps you respond to information, e.g. how full the plane is, which you only have available at that time.  Is that the only advantage?

There is a possible disadvantage for the airlines- price discrimination at the time of purchase is transparent to other airlines.  They can coordinate on the pricing.  But last minute pricing is intransparent.  Maybe United even cuts the advance purchase fare, gives only interior seats to get surplus back via an “add-on” price for an aisle seat.  This might trigger a price war.

On the other hand “add-ons” are very effective for extracting suplus at hotels (mini-bars etc) and for credit card companies (late fees etc).  Is this what airlines are hoping?