It examines the impact Uber has had on the income of taxi drivers in a range of U. For instance, whilst it typically resulted in a fall in income of around 10% among salaried drivers, it resulted in a 50% rise in the number of self-employed drivers in a city.The authors believe their study represents the first serious look at the impact of sharing economy platforms such as Uber on jobs.
The good news is that developments to date point to a clear way forward: If the old ways cannot bring about a satisfactory solution, then all that is left is to embrace change.
Regulators need to allow the forces of competition to shape how the industry will move forward.
Of course, fascinating though the data is, it does simplify matters somewhat as it looks at the issue through the relatively confined prism of employment. It doesn't, for instance, examine the total number of journeys undertaken across both licensed taxis and sharing economy platforms.
In much of the discourse around this issue, the suggestion seems to be that the market is of a fixed size, and therefore Uber drivers are taking income from licensed drivers. I suspect however, that the reality is that Uber et al have significantly increased the size of the market, especially in off-peak times where dissatisfaction with licensed drivers is at its peak.
Oxford Martin School’s Carl Benedikt Frey burst onto the public stage back in 2013 with a paper highlighting the risks various professions faced of automation in the coming years.
He has returned this week with a new paper that is no less contentious. Despite widespread protests against the sharing economy platform, the analysis revealed that the impact was muted.“The higher hourly earnings among self-employed drivers suggest that capacity utilization, in terms of the time spent in the car with a passenger, has increased with Uber, as its platform allows for better matching between drivers and passengers.But for traditional taxi drivers the effect has been the opposite, with a decline in the amount of time they have a passenger in their vehicle,” Frey says.Rising Incomes It's also noticeable that Uber drivers were found to earn more than those in traditional taxi services.This is largely due to the fact that the Uber software allows drivers to better optimize their time and services.Given The Choice If we're in a world whereby the total number of journeys in the "rented driver" market has gone up considerably, then we get into the Public School of Choice field in economics that underpins so much of the apparent rent seeking by the taxi industry. This posits that the gains from restricting practice are highly concentrated, whilst the benefits of not doing so are dispersed.As such, it was never viable to get customers to organize themselves politically to change matters, whereas it certainly was for the taxi industry.In many jurisdictions, they cannot vary their prices in response to consumer demand. They are trapped between maintaining their existing systems, which severely restrict competition but provide for oversight and public safety, and the demands of consumers, who are attracted to the low prices and high service levels of innovative new providers.Some regulators have tried to use law enforcement and the court system to bring everyone up to the existing standard of regulated taxis, with mixed results for businesses and more negative results for consumers.Of course, fascinating though the data is, it does simplify matters somewhat as it looks at the issue through the relatively confined prism of employment.It doesn't, for instance, examine the total number of journeys undertaken across both licensed taxis and sharing economy platforms.