Who benefits most from Uber?

The consumers, most of all.  But how about amongst the workers?  I think you have to slot French taxi drivers under “don’t benefit.”  And otherwise?  That is the topic of my latest New York Times column for The Upshot:

On the positive side, the so-called sharing economy allows workers to use their time more flexibly. Drivers can earn money without working full time, and without having to wait around at taxi stands for the next passenger. The workers can use their newly acquired spare time for other purposes, including studying for college, teaching themselves programming or simultaneously offering themselves out for different sharing services: If no one wants a ride, go help someone with repairs around the house.

In short, these developments benefit those workers who are willing and able to turn their spare time to productive uses. These workers tend to be self-starters and people who are good at shifting roles quickly. Think of them as disciplined and ambitious task switchers. That describes a lot of people, but of course, it isn’t everybody.

That’s where some of the problems come in. Uber drivers are much more likely to have a college degree than are taxi drivers or chauffeurs, according to the Hall and Krueger study. It found striking differences between the two groups: 48 percent of Uber drivers have a college degree or higher, whereas that figure is only 18 percent for taxi drivers and chauffeurs.

Only some workers benefit when each hour, or each 15-minute gap, is up for sale. One way to put the general principle is this: The more efficient market technologies become, the more important are human capabilities and backgrounds in determining who prospers and who does not.

The piece offers other ideas of interest, including about education.  For instance, corporate investments in worker training may decline as the likelihood of freelance work rises.  That too favors self-starters, who can learn on their own.  Do read the whole thing.

Comments

Hot New App Ideas for the Freelance Sharing Economy:

Chim Chim Cher-ee -- Are there any small boys hanging around your house, not earning their keep? They probably don't mind getting dirty, right? Are they skinny and good at climbing? Just enter their maximum diameters into this app and soon they'll be rising to new heights in a time-honored career for boys.

Yes, I guess the way things are going, child labor is due for a reappearance.

But since tiny people are needed to keep the chimneys clean in the million dollar houses of what used to be poor black neighboods in Brooklyn, going backwards must be a good thing.

Time to update Oliver Twist with a Fagin on social media and eBay.

They use an app named Fagin, you see. Totally ironically, of course.

Newspapers used to be delivered by boys, and it's not clear to me that their replacement by adults has been a good thing. Warren Buffett accumulated his initial stake as a paper boy.

What's a newspaper?

'The consumers, most of all.'

Well, that was a surprise - I expected to hear that the persons who benefitted the most to be Travis Kalanick and Garrett Camp, Uber's founders. Much like the persons who benefitted the most from Microsoft were Gates and Allen.

So everyone who bought Windows or Word or Excel didn't benefit at all.

They would have been better doing their spreadsheets on paper with pencil.

Excel has helped me make hundreds of thousands of dollars.

I wonder if my ROI for my one copy is less than what Bill Gates made of selling me that copy?

It depends, doesn't it? At the ERP company I work at, our software was designed for what then called the AS/400 from IBM (the same hardware system Microsoft used to run its own accounting dept, by the way). As one of the owners mentioned at least a decade and a half ago, he had one person who spent an hour or two a day maintaining the work places of more than 100 users, mainly programmers. He also had an employee working fulltime supporting about 8 people using PCs.

At this point, we still have one person who spends maybe an hour a day supporting programmers using that system, and at least 3 people who maintain all the PC associated systems. The software we sell to Mittelstand customers has pretty much remained the same at its core (a fact of just about all ERP systems with their genesis in the early 90s - SAP's R/3 is still the basis of whatever SAP calls its software these days), especially the ones still using those IBM mid-range systems.

That the general rise in computing technology was beneficial is beyond question - but anyone who thinks a monopolist provides the best product is probably unfamiliar with the alternatives that monopolist did its best to embrace, extend and extinguish. Unless, of course, you think it a tragedy that Microsoft was unable to follow through on its mid-90s vision - 'The variation, "embrace, extend and extinguish", was first introduced in the United States v. Microsoft antitrust trial when the vice president of Intel, Steven McGeady, testified[8] that Microsoft vice president Paul Maritz used the phrase in a 1995 meeting with Intel to describe Microsoft's strategy toward Netscape, Java, and the Internet.' https://en.wikipedia.org/wiki/Embrace,_extend_and_extinguish

No, it doesn't depend. Harun's ROI on his Excel purchase is vastly more than the ~$100 that he paid MS for it. He benefited far more than Bill Gates & Co did from the exchange. That huge consumer surplus is just as real regardless of whether MS was generally naughty or nice in their business dealings. End of story.

I am not a Microsoft lover, I think that their OS have problems, but users also benefit greatly from the net effects that benefited Microsoft and there was just enough competition to keep their OS's from getting too bad. IMHO It would have been better had Apple and Linux made had a little more competition in the OS area. In the other areas where the was more competition like spread sheets, word processors and database engines Microsoft's products are quite good.

FYI, Excel wasn't the first spreadsheet program.

And the people who worked for Gates and Allen making Excel, Windows, etc., as a group did very well and many individuals did very well indeed. Can Uber say the same?

Uh, no, the 48% of Uber's employees with college degrees cannot say the same. In fact, most of them would MUCH rather be working for Microsoft, maintaining or marketing Excel, Windows, etc. as full-time employees of Microsoft than as task rabbits, picking up scraps for Uber and the rest of the so-called "sharing economy".

Why does Tyler keep writing these paens to Uber? Is he on retainer for PR for Travis?

But the mistake is thinking that if not for Uber or Postmates (who I've driven for recently), these people would obviously be working at Microsoft et al. because they have a degree. But no, they wouldn't be.

I guess it's common to resent the one you're with when you'd rather be in a relationship with someone else. But for many, the alternative is to be single.

"self-starters, who can learn on their own" will not be happy with employers who are not willing to invest in them, or at least let them work in the ways that are most efficient for the individual.

"For instance, corporate investments in worker training may decline as the likelihood of freelance work rises. That too favors self-starters, who can learn on their own."

Heard this one before plenty of times. I just ain't buying it. For several reasons:

1) Training isn't about "general" skills. It's about firm-specific skills. In that case, "freelancers" are the last people you want.

2) Freelancers are usually pretty bad. I'm sure someone out there has studied this, or should. But at least from my experience, the quality is below abysmal. The same usually applies to outsourcing. You really only want to do this stuff for low-value activities, and only if the price is low enough.

3) This really all depends on the customer tastes. But the "new knowledge economy" also is likely to lead to differentiation and evolution in customer tastes. How good are "freelancers" at helping a company meet more "niche" and "differentiated" customer needs, compared to dedicated employees trained in the firm-specific knowledge? A bunch of "freelancers" costing you reputation and damaging your brand? Hmm...not in the "new knowledge economy" where every Joe Schmo can rate you online.

Of course, this "freelancing" stuff on internet marketplaces similar to an e-bay or Amazon have been around for a while. Sure there are some companies that take advantage of it, but it's usually the companies at the margin who weren't doing any "training" to begin with. We (researchers) have hired some from such websites to write code for us. Every time it's abysmal work. Now we just go to our resident software people to write it for us, regardless how long it takes.

But the biggest impediment is still: firm-specific knowledge. This is where firms create "competitive advantage" over other firms. Not general knowledge. (and freelancers are usually far below general knowledge to begin with)

PS: People, regardless how smart or intelligent they are, rarely can learn on their own.

You can substitute "freelance" with "temp worker" and get the same thing. I.e., these are low-cost low-value solutions, which are not substitutes for "training".

Another new app for the Freelance Sharing Economy:

Biens -- You know how in Frank Capra movies hobos are always huddled around campfires, morosely eating from cans of beans? Sure, back then the media made it look kind of sad, but Average Is Over. Now that you have a smartphone to provide 24/7 video entertainment, who needs to eat meat or live indoors? Biens the App opens the door to you and the rest of the Ninety Percent to become high-tech hobos. Imagine you and your loved ones huddled around your glowing smartphone watching "Mad Men" as you all cluck condescendingly at how Americans used to eat steak and live in houses while barely noticing the horrifying truth about life in America in 1960: they only had three networks to watch. Biens is the lifestyle for the 21st Century, a new (yet old) way of living that's both luminous and leguminous. (Actual beans for eating sold separately.)

Somehow, I don't think this is the real Steve Sailer, a serious science journalist who writes on race, citizenship, and other, like, real stuff.

You are clearly not reading enough Steve Sailer. He mainly writes about gold courses.

Another new app inspired by "Average Is Over:"

Slave -- Credit card minimum payments getting you down? Mortgage lender threatening to repossess your home? Now you'll never have to worry about money again! Just download the new Slave app and sell yourself (or a family member) into slavery. It's a state of the art rendition of a time-tested solution to financial concerns. Just enter a few details about yourself (e.g., good teeth, strong back, poor map-reading skills) and the auction begins! Thousands of oil sheiks, Mauretanian camel drivers, and UN diplomats are bidding constantly. A few taps on your cell phone screen and you'll have food and lodging provided to you forever! And note that Slave has to be good for you because it has an ironic name. Or does it? Perhaps the name is meta-ironic, which sounds even better ... In any case, you'll never know until you try! (Also comes in Slayve for metalheads.)

Having been on both sides of the freelance/temp method of out-sourcing/in-hiring, I can say it has its advantages and disadvantages. Most of the disadvantages arise from the fact that is that it is often misapplied. One doesn't hire a free-lancer as a full replacement for a full-time employee in most companies. To get the maximum value, one hires the free-lancer for one, or at most two, very specific tasks that the free-lancer focuses on exclusively. He doesn't (or, ideally, shouldn't) have to deal with all the ancillary tasks/responsibilities- like attending departmental meetings, taking mandated corporate "training" etc. You hire for that specialization and focus, and if just hire them and make them responsible for all the other crap, too, then it will fail.

That's pretty much what I said. They're not substitutes, they are complements. But in vast majority of cases, they are complements in the sense that they take on low-cost low-value tasks and allow full time trained employees to focus on the rest.

>People, regardless how smart or intelligent they are, rarely can learn on their own.

You are correct. That's why I raise an eyebrow of doubt whenever I read about self-didacts and auto-didacts. The time that it takes me to learn something on my own is almost always a multiple of how much time it would take me if someone explained it. "Explained it" means a real person, not a MOOC or Khan Academy video-tape. No, it is not because I am stupid. (Someone always suggests that in the comments here :)

Yes, you're right. It's not even if people can learn on their own or not. It's that its almost universally...more wasteful...to try and learn on your own.

You should check out the recent set of posts from Justin Fox over at Bloomberg View. He's been making the point that the US is actually quite low among OECD countries in using Non-Full-Time workers. They're much more common in Europe, unsurprising when you consider the stronger job tenureship rights for permanent employees in many continental European countries.

“self-starters, who can learn on their own"

Yes, its very hard to use an app on a smartphone.

Its also very hard to drive a car.

Its even harder to be polite and keep your car clean.

So why should we pay licensed taxi drivers more than these people, again?

'In short, these developments benefit those workers who are willing and able to turn their spare time to productive uses.'

For example, put a couple of child car seats in, and provide child care and transportation at the same time.

https://shuddle.us

If these people were "disciplined and ambitious" "self-starters", and if those qualities were sufficient for success in this new knowledge economy, wouldn't they not be driving cabs in the first place, a job which, incidentally, is not new nor requires any knowledge?

At what point do you start thinking that maybe these people aren't really "disciplined and ambitious" "self-starters", or that maybe this vaunted new knowledge economy is actually just a really crummy economy that doesn't offer much for even "disciplined and ambitious" "self-starters"?

I have some better advice for these workers: Change your name to Sanjay Gupta.

The guys that kept their jobs during the DotCon collapse were those that had "community organizers" that helped them negotiate big cuts in salary and finding shared housing in the area to cut living expenses.

In practice what this means: Try to hook into the H-1b ethnic network somehow. Perhaps the best way to survive a collapse in employment is to get a tan, change your legal name to the moral equivalent of Sanjay Gupta and contact one of the many immigration law firms that aid and abet H-1b immigration fraud with a sob story about how you're going to be sent back "home" (don't tell them "home" is Champaign Urbana Illinois) if you can't find a job -- and that you'll be willing to take a big pay cut and live in a beehive to stay in "America". Do it with the appropriate accent. They'll hook you up with a "community organizer".

Wow, bizarre comment.

BTW, Sanjay Gupta's hometown is just one county over from mine in Michigan.

Yep. Local boy. Grew up in the suburbs of Detroit, went to Michigan for undergrad and med school. I think he even practiced in Jackson for a while.

Sad to see the many comments at NYTimes disparaging uber. Yes, life isn't easy, and helping to adjust people from old jobs to new jobs is important. Lucky for us the consumer surplus is so high this time even the regulators and politicians themselves use uber.

"helping to adjust people from old jobs to new jobs is important"

I marveled reading Barry Goldwater's autobiography at how his forebears, when facing dwindling fortunes, entered new trades or even--get this--MOVED LOCATIONS! People sure were stupid back then.

Goldwater was born in 1909 in the Arizona territory. If his forebears were out West back in the 19th century, they would have been out there before the frontier closed. That meant free land or very low rents. There are no such frontiers today.

Exactly.

I'm pretty sure his paternal ancestors were Jewish and moved from somewhere like Germany or Russia. They didn't speak English, and when they got off the boat at Ellis Island they were pretty damn far from Arizona, where the inhabitants were mostly Indians who probably didn't speak English or Spanish, much less Yiddish. According to the Washington Post, "[Barry Goldwater's grandfather] hitched four mules to a peddler's wagon and left Los Angeles for the Gila City diggings in 1860."

Moved locations, indeed.

Ellis Island left Los Angeles for the Gila City diggings in 1860.

Ellis Island, indeed.

Rents are still pretty damn low in Arizona.

When I was out there 3 years ago, you could rent a two bedroom house for under $1000/month.

Wow, I pay that much for a one bedroom apartment in Oakland with a leaky ceiling. (The drought has been good for me.)

https://www.swamprentals.com/gainesville-apartments/2-bedroom-apartments-in-gainesville

It's always been very hard to switch industries. In the old days it would takes decades for a new technology to displace the old, so you would only have a very small number of people left who refused to get out, because most of the young people avoided going into the dying industry.

In comparison, the taxi market was devastated in about 5 years (Uber founded March 2009). Sure, from 2015 we can say it was obvious this was going to happen, but if it really had been obvious in 2008 someone else would have founded Uber first. (Uber doesn't have that much secret sauce; it was the widespread use of smartphones that made them able to exist.)

Is that true, that the taxi market has been devastated by Uber? Uber hasn't made noticeable inroads in Arizona yet, not that I can tell.

In the case of Uber, technology obviates the need for training. A person needs to know how to use the app, and thanks to GPS and google maps, a driver no longer needs to memorize a large number of streets and routes.

My recent anecdotal experience reveals a pattern at the opposite of the part-time Uber worker: in Paris one Uber Pop driver was a full-time train driver for the Paris metro (this means maybe 32 hours/week) and in Milan three drivers were retirees in their (I would say) late fifties/early sixties.

It may well turn out that the market clearing wage for car services is just enough to cover the gas. Some people, it turns out, live giving other people rides.

The effects on people trying to support their families can be pretty bad, though.

Rather than saying that Uber benefits its drivers, it seems more accurate to say that those drivers were previously harmed by taxi regulations and licensing. We are witnessing the counterfactual world that would have existed in the past had such regulations not existed. That also gives us an idea of just how many people are being shut out now, and how much consumers are being harmed, in other industries where licensing and regulations are still binding.

+1

Although the there is a technology story with Uber (GPS, smartphones, apps, and a scaleable backend) this really is a story about the harm that regulation bring to society. This is why the left is so venomous about Uber.

Best comment on the thread.

One recent study, by Jonathan V. Hall of Uber and Alan B. Krueger, a professor of economics at Princeton, supported by Uber, suggested that Uber drivers earned more than typical taxi drivers and chauffeurs

I thought that Uber's claims about how much their drivers earn had been debunked, or at least countered, by other analyses of what the average take-home pay really is, especially when factoring in the drivers' costs, and how getting the necessary high fares is not really doable for most drivers. To be clear, I am fine with Uber and these services, but Tyler should have been aware of the debate about this and he just parroted Uber's position.

http://blogs.wsj.com/digits/2015/01/22/ubers-study-stirs-debate-on-driver-pay/
http://www.slate.com/blogs/moneybox/2015/01/23/uber_driver_wage_study_contract_work_for_uber_is_flexible_but_is_it_reliable.html
http://citypaper.net/uberdriver/

Nothing against Uber. But if you take all the "regulations" out from the taxi business, you all know from Microeconomics 101, who is the loser here...On the other hand traditional taxis should look deep into their own mirrors... After all, what stops them from building a similar app?

In fact, traditional taxis have built a similar app: http://gocurb.com/

Tyler must be on public relations retainer for Uber, else he would have been aware of the studies you just cited. Tyler is writing these Uber-praising articles for the New York Times, and is an eminent economist. I would think that he has time to read the Wall Street Journal or use an internet search engine prior to writing NYT articles. I am merely a poor childless widow in Arizona, but even I was familiar with those two studies, published in January 2015, which you cited in your post.

"The more efficient market technologies become, the more important are human capabilities and backgrounds in determining who prospers and who does not". True, but in a more egalitarian way. For example, a good deal of the human capital that successful parents can pass on to their kids is now "elemental" or "raw": At the top, those who succeeded in the corporate world may not not be well suited to advise on careers in the sharing economy; in the middle, those who succeeded on trades with cartel type employment have much less of a chance to give their offspring a leg up; at the bottom, if you had to hustle for your livelihood, you can at least pass on the temperament.

I agree that consumers benefit but I'm not so sure workers benefit as well. Tyler, I think your reasoning is correct. However, to check if this reasoning adherers to reality, we would need to know what proportion of Uber drivers are 'part time' workers with flexible hours that choose to be part time Uber driver as a way to supplement their income. And this percentage is only 31% of Uber drivers, according to the study Hall and Krueger (p. 10, last paragraph).

Most of Uber drivers have no other job (38%) or are working full-time on another job and partner with Uber (31%). In both of these situations, I wouldn't be so sure that these workers 'benefit' from Uber in their 'spare time', as you say. Partnering with Uber, in theses cases, might just be a constrained choice of individuals with low qualification in a precarious labor market.

"Most of Uber drivers have no other job (38%) or are working full-time on another job and partner with Uber (31%). In both of these situations, I wouldn’t be so sure that these workers ‘benefit’ from Uber in their ‘spare time’, as you say."

But some of those with no other job are surely students and retirees who don't have time for or don't want another job (especially not one with a schedule they don't control). And just how is not beneficial for workers who have a full-time job to be able to supplement their incomes by, say, driving for Uber for a few hours a week? What would be their other, better options for topping up their income? In what conceivable way don't these workers benefit from having Uber as an option vs not having Uber as an option?

Could we split this up into Uber, UberX and UberPop percentages?

I would guess offhand that the regular Uber black car service has more full-time workers, while UberPop is more part-time.

There's been a lot of talk recently about how college has been become a requirement for a much wider set of jobs, even ones that previously were HS only. They lament this, point to the weak job market as letting employers do this, and suggest ways to get companies back to highering more HS graduates. Anyway, so I thought it was interesting that so many Uber drivers are college educated.

Most people I know use Uber as a civil (taxi interests) disobedience and protest mechanism. We are disgusted at the driving style and rampant car-flow interruptions that taxis feel that is part of their oeuvre. That being said, I am completely fine with a casual Uber driver exhibiting the same behaviour, knowing that that driver is doing this [work] as a necessary evil to provide extra income flow to supplement for what I otherwise assume is a worthwhile or potentially worthwhile existence. I feel that if you do a certain job as your main profession you have a duty to act/perform in a way that is viewed socially as being upstanding, dutiful, and work-focussed - a certain decorum - like wearing that peaked cap and pressed shirt - just taxi drivers, not Uber-ers. That also being said, at what point does a casual service (as a proportion of all taxi-type service) become so dominant that all the safeguards such as licencing and insurance etc., become important at containing the expected overall increase in accidents, claims, and driving infractions - for having that many more drivers in dense urban areas?

Here's to hoping that many of the other maintenance, infill, and quick-task type jobs can be filled with casual workers - maybe bring them in to substitute for city workers (and their unions) for park maintenance and quick non-mechanical repairs.

"Spare time" is basically leisure. Using spare time for work means less leisure. So, these services reward workers who don't value leisure much and prefer working. Another way of saying the same thing is that these services don't pay enough to allow people to "consume" time as leisure.

Or, whatever else they are doing doesn't pay enough to allow them to consume time as leisure. Like studying.

You are 100% free to give an enormous tip the next time you take Uber, or a taxi, or partake in any other service.

Wait, you don't? Wait, you just want other people to do as you say? Oh, I see.

I find it more likely (than Cowen's thesis) that Uber was transformative because the taxi market was regulated to treat it as a skilled profession at a time when it had become unskilled. Uber has made less ground in very strongly regulated, and very weakly regulated, taxi markets. The former because of legal restrictions, the latter because the producer surplus is not there to be wiped out.

I've never used Uber, but it came up in conversation yesterday with the owner of a night club. The province has made it pretty well impossible to have any alcohol at all and drive, putting out of business quit a few pubs and bars. I said we need uber here, and he agreed. There are three taxi cabs in this town, two less than there are bars. I may be exaggerating, but not by much.

A few questions. Is uber popular in London? They seemed to have a reasonably well organized taxi system with well trained drivers.

How many uber drivers have gotten job offers as a result of the quality of their service? Clean, prompt, polite, consistent. Maybe that is why taxi services are so bad.

How long has the regulated system been in existence? If we give it another hundred years will it match uber?

How much do taxi drivers make?

Which system allows me to exist without a vehicle?

It seems like you are complaining about a 0.08 limit. There is good evidence backing this as the max BAC, and it should probably be even lower than thant. Can people still go to the bar and get rides from friends, taxis or Uber? Sure. It might not be as easy as people would like, but how many drunk driving fatalities is it worth? I'd blame the drunk drivers for this more than the province.

http://www.ncbi.nlm.nih.gov/pubmed/16824545

The relative risk of being involved in a fatal crash as a driver is 4 to 10 times greater for drivers with BACs between .05 and .07 compared to drivers with .00 BACs.

No, it is more stringent than that. Essentially it they smell alcohol on your breath they seize your vehicle for 24 hours. They don't bother pressing charges because they rarely get convictions.

Not to debate the proud and cons of the policy, except that regulated taxi services are woefully inadequate. An uber type service would be very useful.

Ok, sorry. Not having to even test people, when the technology is readily available, does seem excessive. Especially since, as far as I know, the law doesn't say it is illegal to have any alcohol at all to drink before driving.

As some benchmarks for taxi costs, the cost in Arequipa, Peru is about $2 (USD) for a short ride, or $6 per hour, in China, about $0.6 per mile, a 47 minutes cab ride from airport to hotel in Shanghai costs $22, which is at least $50 less than in most US cities. Who deserves that $50? The license owner? (Or rentier, if talking the Marxist language of this blog). The employee? It sounds like a win/win where the driver makes more, and the customer pays less should be achievable.

http://wikitravel.org/en/Arequipa

http://www.taxifarefinder.com/main.php?city=Shanghai-China&from=Pudong+International+Airport%2C+Shanghai%2C+China&to=The+Bund+Riverside+Hotel+Shanghai%2C+Shanghai%2C+China&fromCoord=31.150462,121.80585300000007&toCoord=31.24046149999999,121.48234909999996

Very good article, Tyler.

Why did the NYT close their comments at 32? That's less than here!

Anyway, I really flashed on the point that Uber could market its driver (and passenger) ratings outside its service network. Not only is there money there, but a whole new way of contextualizing the world.

What's also needed is a multi-service marketplace so that I could pick up your groceries and your kids on my way over to fix your plumbing.

The bile and saliva corroded the link.

If you have a choice of being a shift worker at Starbucks or go with Uber and have complete control of your time, whether part-time or full-time, which do you choose?

Another way to look at it. If you're considering whether to hire someone, would you rather see Starbucks or Uber on their resume? Starbucks shows conscientiousness and a good customer face. Uber is about both of those, but also about initiative.

Now do you see?

On the positive side, the so-called sharing economy allows workers to use their time more flexibly. Drivers can earn money without working full time, and without having to wait around at taxi stands for the next passenger. The workers can use their newly acquired spare time for other purposes, including studying for college, teaching themselves programming or simultaneously offering themselves out for different sharing services: If no one wants a ride, go help someone with repairs around the house.

Colleges are in effect already doing this through the hiring of adjunct professors, which most tenured or tenure-track professors deplore but seemingly do nothing about. A few weeks or months ago you wrote about Uber for private tutors, but I'm really ready for AirBnB for private tutors, which for me and perhaps many others would be an improvement over being an adjunct.

"If you have a choice of being a shift worker at Starbucks or go with Uber and have complete control of your time, whether part-time or full-time, which do you choose?"

Well even part-timers at Starbucks get healthcare. So there's a point in their favor. Maybe even two points.

You forgot PPACA. Everyone has health care now.

There is a rough precedent for Uber taking over from cab drivers - HuffPo freelancers taking over from journalists. Who has benefited from that?

Who benefits from Uber?
This article seems to provide information that would make us believe the consumers are the main beneficiaries from Uber, however I can't imagine that being quite the way the consumer's feel considering the numerous stories from friends and co-workers. Economically on an individual level, as a consumer(someone who uses the uber services for transportation) paying a fare that bills for the miles and for the time spent driving with a ton of hidden fees that are not explicitly explained does not sound like benefitting to me. Whereas when I get in a cab and I see the meter I know exactly what I am paying for plus tip. Also, with all due respect, I would not demand my driver to have a degree because that is not of my concern but I do care about their licensing and records as a driver. Also, through a physical company that taxi drivers must report to everyday there is a sense that they are upheld and responsible for their actions in the company's car and usually with the company's name and reputation on display and open to criticism. Overall, I cannot say that I agree with the statement of consumer's gaining the most from Uber.
Now economically what does this mean for the Uber, its competitors, and the industry overall? Well based on the very simplified version that I understand of Supply and demand, the supply shifts to the right because we have more companies supplying service and as a substitute for taxi services, the demand of taxi services shifts to the left. This drops the equilibrium price for the transportation services in general. This is not even including the impact it has on bus and metro or trains, it is only comparing taxis and uber transports.

This is a silly comment. I've never seen a new product or service adopted so quickly and so voraciously by consumers as Uber, and neither have you. The space was crying out for disruption, and it happened. Uber CRUSHES taxis everywhere in the world except where they aren't allowed to, and even there they do well. Uber's dominance is entirely about the consumer. The flexibility for drivers is also a good thing but not the reason for the success of Uber.

Not even mentioning that Uber fees are generally less than taxis, so whatever 'hidden' fees they are hitting you with don't rally matter (unless you prefer higher, transparent pricing to lower, more opaque pricing).

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