Taxis were originally as cheap as ubers used to be (think rickshaws in developing countries). Absent regulation, the price goes down to the cost of fuel, because this is a class of workers with barely any bargaining power. Uber originally claimed their innovation was logistical efficiencies ("traveling salesman") which would lower prices, but I don't think that matters as much as avoiding the regulation and removing bargaining power from drivers.
It's a cycle: rickshaws > regulation > new rickshaws ("innovation") > regulation.
This will hurt the people who take ubers for convenience e.g. don't feel like walking or squeamish about public transit. But won't affect people who need to get A > B directly. IMO this is a good thing -- more people on public transit will improve public transit.
Public transit is so slow (an hour vs. 10 minutes driving) that it isn't possible to use it schedule-wise - we'll just be taking the pricing hit. Others might be less able to absorb the pricing hit and will just suffer (it's either pay more or lose job).
If you didn't really need that uber, you get back to walking, biking, or busing. Or decide not to take the trip.
You might be helping the small segment of low income drivers, but hurting plenty of other low income users who may have difficulty paying higher prices. I have no idea what the net effect is, but what worries me is the state (as far as I'm aware) didn't run such an analysis before passing such far reaching laws.
She constantly tells me uber saved her life. Because her usual $20 vab ride to the pharmacy was now $4
This law is literally going to destroy the life of many seniors.
yes - there is paratransit - but we are talking schedule 2 days in advance, long bumpy van ride etc etc and hit or miss in a lot of other ways.
For the 10-minute ride in your example, the upper and lower ranges aren't going to be very far apart.
Yes, but not because of this law.
Uber has been subsidizing the rates with VC money for years, which is why they've never been profitable, while being able to destroy competition that does have as deep a war chest.
They'll now get to raise rates and move to profitability while using employee protection laws as air cover.
"The Market Fairy Will Not Solve the Problems of Uber and Lyft"
https://www.ianwelsh.net/the-market-fairy-will-not-solve-the...
> Here is the thing about Uber and Lyft (and much of the “sharing economy”).
> They don’t pay the cost of their capital.
> The wages they pay to their drivers are less than the depreciation of the cars and the expense of keeping the drivers fed, housed, and healthy. They pay less than minimum wage in most markets, and, in most markets, that is not enough to pay the costs of a car plus a human.
> These business models are ways of draining capital from the economy and putting them into the hands of a few investors and executives. They prey on desperate people who need money now, even if the money is insufficient to pay their total costs. Drivers are draining their own reserves to get cash now, but, hey, they gotta eat and pay the bills.
That isn't at all the same thing as being unsustainable, because people typically have cars whether or not they drive for Uber. Depreciation comes from both miles and vehicle age, but in general more of it comes from vehicle age. It doesn't matter if the rates can cover the portion of the depreciation attributable to vehicle age because it's not an avoidable cost; you pay it either way.
Critics also like to do these calculations using "average" vehicles and so on, but people aren't stupid. If you're making a living from driving then you buy a car that gets above average mileage and below average maintenance costs. The fact that you can't make a living doing it in a pickup truck is pretty irrelevant when the people doing it are driving hybrid sedans.
The average numbers also get brought down by the people doing it on the side. Some people drive to work every morning and will take a couple of passengers who are going in the same direction. Those people have close to zero incremental costs; they don't have to recover anything. Meanwhile the people doing it full time aren't taking whatever rides they can get at whatever rates they can get along their existing commute, they're working in the places and times that give the best rates, so they need to make more than the part timer but they also do make more.
The whole thing is in balance. If people aren't making enough money to sustain themselves then sooner or later they figure that out and they quit, which makes the price go up because there is less competition. If the price is high enough to be attractive to people then more people start driving and it comes down some. You reach an equilibrium.
That may be different for cars bought after they've already suffered most of the age-related depreciation they ever will, but in that case there is only modest depreciation in either event because the car can't lose much value to depreciation if it was already not worth very much when you bought it.
Who should we trust to make the calculation on whether it is a fair price for a "human" ? - 1 blogger with potentially an axe to grind - miilions of people who vokuntarily drive their cars and make money in the process
Which is it?
Hint: actions speak louder than words
Uber's a public company now, it has to price its services to make a profit, or to at least reduce the billions it loses each year because its prices aren't in line with market forces.
That can't be the whole story. Surely the artificial restriction of supply (taxi medallions, etc) must contribute to a higher cost.
"It has to make profits because market forces"
Article is about California passing law that effectively restricts supply
Which is it??? Is the free market mandating the price hike, or are price hikes due to regulation?
All of the estimates I've seen range from $10-20 an hour after all of their expenses are factored in. Let's be really conservative and take the bottom quartile, so Uber drivers make $10-12.50 an hour.
That's.... a perfectly normal wage for tens of millions of people. Have you eaten a meal out or gotten a coffee, ever? That's how much money the people behind the counter were making. Did you feel like you were contributing to a 'serf class' when you bought a coffee this morning, or bought dinner last week?
And if these people weren't employed by Uber, they'd be working for $10-12 an hour at a different employer instead. Kind of by definition, they lack the ability to earn more money in the market (especially this job market!) because if they could they'd already be doing so
The minimum wage in California (the subject of the OP) for companies with more than 25 employees is $13.00. I know you were trying to be conservative in your estimate and I don't know if that $10-20 range you're referencing is for California, the USA, or all Uber drivers. Maybe the real average is higher than that, but it's wrong to present $10-12 as a "perfectly normal" wage for workers in California.
I just think it's overly dramatic when people present lower wage jobs as literally serfdom or whatever- especially when the HN crowd has undoubtedly eaten out, had drinks, hired a contractor, got coffee, or employed a cleaner that was probably making the same as an Uber driver. There will always be low wage jobs. No one's picketing coffeeshops for making their employees 'serfs', why single out Uber?
https://www.businessinsider.in/the-32-places-uber-and-lyft-d...
Also keep in mind that pretty much no minimum wage job except ridesharing allows you to earn to and from your way to work.
If you make $13 and hour on an 8 hour shift in California with a 1 hour commute each way and a $3 bus fare each way, it comes out to $9.80/hour not $13.
The end result will be that many people just won't be able to drive for Uber or Lyft any longer. So you are taking money making opportunities away from many people and giving to a select few (the ones that can make the cut as employees).
The next step will be unionization..and then we will be back to the taxi cab situation: high prices, difficult to become a driver, and sub-par technology that stays decades behind the rest of the world.
Quite frankly anyone that thinks they can suddenly make a decent living off of just driving people around and had that vision of making it rich doing Uber was stupid in the first place. If it is easy enough for anyone to do it then rest assured it won't be lucrative. The corollary is true if something takes great skill and is difficult and people need it then you are probably going to be able quite a bit more. Supply and demand economics 101, if we keep trying to approach economic issues from social perspectives we are going to end up with lots of stupid decisions that cause more problems than the solve. Classic example rent control.
Cutting checks is a lot simpler than policing the terms of private transactions. Particularly when not all those transactions look like full time work for one corporate employer.
Machines work 24/7, never get sick, and don't unionize.
A UBI of course has a lot of other benefits (being distributed monthly or more often, going to people who are unable to work, being universal and therefore more resistant politically).
You’re right that annualized refunds are far from ideal. Monthly would be better.
Argument in video form, with diagram below.
https://mru.org/courses/principles-economics-microeconomics/...
Also, tax credits can be (and are) paid weekly.
She drives to talk to people and make a bit of extra money, it was never meant to be a job to support us. I personally think she is crazy for putting up with all she does. Anytime she is waiting for passengers or going through a drive through (for the passengers) for 15 minutes she makes NO money, because the ride price is fixed (and yes after events passengers will get in the van and one will be outside talking to someone else and she has to wait for them to get in, not getting paid for her time). She tells me all the time, a few riders are really grateful, but most don't care and the driver is just some person they hired (she has hard candy and the large things of bubble gum for riders, a few weeks ago a group of guys stole one of the things of gum, she saw them walking away with it and laughing, $6 down the drain).
There are also the passengers who order the Lyft, she shows up and they are 2 streets over from where they said and tell her to go to a different location. Again, she could cancel the ride, but unless someone is in the same location waiting for a ride she would be losing more time and money.
So i think charging for ride time is fine. If the driver does take extra turns and time for more money you can always give them a lower rating, i am unsure about Uber, but the driver rating at Lyft really does mean something.
I think it would have come across more clearly and been better received if you'd made that point directly rather than ironically.
Edit:
On top of that, I'm not coming into this thinking that this is whats best for all those people in their current situation. This is what I think is best for my society and country. I do not want companies to be able to push off large costs of doing business to their employees by just calling them contractors. I don't think this is good for _me_ in general and so I would support laws like this
Could you be wrong? Perhaps Uber drivers chose the profession by choice. Perhaps before the company Uber existed, these drivers would be less content.
Perhaps you or I are not smart enough to calculate what each individual wants and needs.
Despite the fact that we commit the world's most powerful computers to the cause, weather prediction systems are incredibly inaccurate. Should those wearing inappropriate attire be fined?
Yea, but I can turn the question right back around at you. You are trying to claim that this law shouldn't have passed because people can make the best decision for themselves. I am saying that I view this law passing as one of the best decisions for me. I do not want to work in an environment where companies can be this predatory without regulation. Letting companies do so will embolden other companies and then put downward pressure on my wages.
The other thing sounds like "this policy is good for me personally so I'll support it", which is at least honest.
Have you ever asked an Uber driver how they feel about the law? All the ones I spoke with dislike it. You think you're doing good by forcing people how to live? Your position is either arrogant or uninformed. Uber driver loved their jobs and the freedom they provided until politicians came in to enforce your view of the world. If they couldn't figure out taxis, what make you think they can figure out Uber?
I literally do not care about their opinion. I believe how Uber acts is bad for a society to let continue. The Uber drivers may be getting a good deal for themselves, but I think it has negative externalities that they themselves don't care about.
Someone may be fine getting abused, or it may even be the best deal they personally can get at the moment. When we watch it happen and let it happen we are implicitly condoning the behavior which leads to others to act just as bad or worse.
You are not going to change my mind on this by trying to convince me that the drivers don't want it, I already believe you and it is not influencing my decision
>There is no commonly accepted modern definition of feudalism, at least among scholars
"As with slaves, serfs could be bought, sold, or traded (...), abused with no rights over their own bodies, could not leave the land they were bound to, and could marry only with their lord's permission."
Does anyone really think this is how Uber drivers live?
They have very little control over their lives and work, Uber does not let them set prices and they arent making enough money to go retire early. I refer to them as serfs in that they have to answer to Uber with no actual negotiating power on their own.
How is that "they have to answer to Uber"?
That's...not how law works. The law doesn't adopt a different meaning in litigation than it has in administrative application; when the Court adopts an interpretration/operationalization of the law (which is what adopting a “test for use in litigation” is), it defines what the law is. That's true in general in common law systems, and it's certainly true in specific in that administrative application if California State Law is controlled by how that law has been interpreted by the State Supreme Court.
Making the legal regime more resilient against future change in the composition of the Supreme Court is a thing, whether it's something that justifies the effort expended or not, it's really not my place to say. But AB5 did not substantively alter the status quo legal regime faced by Uber, etc., so any change in practice they shot was not driven by a change in legal regime stemming from the law.