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When it comes to Uber, it's more difficult for me to consider because I'm less sure of the social utility provided by the application, particularly when we take

When it comes to Uber, it's more difficult for me to consider because I'm less sure of the social utility provided by the application, particularly when we take the massive unsustainable subsidies out of the picture. I think the entire question is distorted right now by the fact that they've been in massive growth mode for years so we don't actually know what the equilibrium of the gig economy looks like in many markets.

xyzzyz 6y ago
But the subsidies make it even less of a reason to regulate the employment relationship between Uber and the drivers. The extra money can only be used to artificially inflate the earnings of the drivers, not to depress them. What happens is great transfer of money from the pocket of investors to the pockets of drivers, and the regulation are trying to reduce it.
- james-mcelwain 6y ago
  The subsidies only make it a less-worse bad idea. Particularly when you take into account things like predatory car leases many drivers take out. Like, I think there are interesting broader questions here about regulation and the social safety net -- but I think we need to be clear that Uber is basically a payday loan on your car's title. People are bad at understanding depreciating assets. Maybe if there were a stronger social safety net there would only be a labor market for drivers for whom Uber is actually a good fit? It's certainly possible.
  - xyzzyz 6y ago
    I think we need to be clear that Uber is basically a payday loan on your car's title. People are bad at understanding depreciating assets. This is simply untrue. Cars do depreciate, but not so much to make the whole business unprofitable. A double digit percent of the Uber drivers (probably even close to half of all) drive in rented vehicles. Hertz for example has a program[1] where you pay $200-300/week for renting a practically new vehicle. This makes the depreciation costs explicit to the driver. I think Hertz has some pretty good experience with valuing vehicle depreciation. Assuming Uber drivers do 1000-2000 miles a week, Hertz rate translates to something like $.10-.20 per mile in vehicle depreciation & maintenance. A non insignificant cost, but hardly a deal-breaker. Maybe if there were a stronger social safety net there would only be a labor market for drivers for whom Uber is actually a good fit? Maybe now there are drivers for whom Uber is actually good fit? Have you talked to your drivers? In my experience, most of them are pretty happy about the arrangement in general, and the only complaint is low rates. [1] - https://www.hertz.com/rentacar/misc/index.jsp?targetPage=uber_landing_page.jsp https://www.hertz.com/rentacar/misc/index.jsp?targetPage=ube...

xyzzyz 6y ago

But the subsidies make it even less of a reason to regulate the employment relationship between Uber and the drivers. The extra money can only be used to artificially inflate the earnings of the drivers, not to depress them. What happens is great transfer of money from the pocket of investors to the pockets of drivers, and the regulation are trying to reduce it.

james-mcelwain 6y ago
The subsidies only make it a less-worse bad idea. Particularly when you take into account things like predatory car leases many drivers take out. Like, I think there are interesting broader questions here about regulation and the social safety net -- but I think we need to be clear that Uber is basically a payday loan on your car's title. People are bad at understanding depreciating assets. Maybe if there were a stronger social safety net there would only be a labor market for drivers for whom Uber is actually a good fit? It's certainly possible.
- xyzzyz 6y ago
  I think we need to be clear that Uber is basically a payday loan on your car's title. People are bad at understanding depreciating assets. This is simply untrue. Cars do depreciate, but not so much to make the whole business unprofitable. A double digit percent of the Uber drivers (probably even close to half of all) drive in rented vehicles. Hertz for example has a program[1] where you pay $200-300/week for renting a practically new vehicle. This makes the depreciation costs explicit to the driver. I think Hertz has some pretty good experience with valuing vehicle depreciation. Assuming Uber drivers do 1000-2000 miles a week, Hertz rate translates to something like $.10-.20 per mile in vehicle depreciation & maintenance. A non insignificant cost, but hardly a deal-breaker. Maybe if there were a stronger social safety net there would only be a labor market for drivers for whom Uber is actually a good fit? Maybe now there are drivers for whom Uber is actually good fit? Have you talked to your drivers? In my experience, most of them are pretty happy about the arrangement in general, and the only complaint is low rates. [1] - https://www.hertz.com/rentacar/misc/index.jsp?targetPage=uber_landing_page.jsp https://www.hertz.com/rentacar/misc/index.jsp?targetPage=ube...