5 ms·

Let's just ignore all the externalities created by market-breaking and law-ignoring, tho!

cercatrova 4y ago
Well, I'd rather ride in an Uber than a cab and until very recently stay in an Airbnb rather than a hotel. For better or worse, they truly did disrupt those industries for consumers, much as non-customers might complain.
- piva00 4y ago
  > For better or worse, they truly did disrupt those industries for consumers, much as non-customers might complain. Ignoring all the suffering caused by the externalities on rental market caused by Airbnb in very touristic areas (e.g.: Lisbon, Barcelona, etc.), it's great for consumers. The issue is that none of these externalities are priced in, there is no compensation or fair counterpart for the victims of these companies. And somehow it all seems ok for some people...
  - s1artibartfast 4y ago
    They aren't externalities and shouldn't be priced in. Should the luddites have been compensated by those who operated mechanical looms? If not, How are the situations different?
    - p0pcult 4y ago
      >They aren't externalities and shouldn't be priced in. If people in my city can't afford housing because of AirBnB, it has negative impacts on my city as a whole. This is an externality, which--by definition--is a thing that isn't priced in. An externality is defined as "a side effect or consequence of an industrial or commercial activity that affects other parties without this being reflected in the cost of the goods or services involved, such as the pollination of surrounding crops by bees kept for honey." >Should the luddites have been compensated by those who operated mechanical looms? UBI advocates might say yes; it's the whole idea that once some threshold of automation is passed, you won't have enough consumers to keep the economy running.
      - lmm 4y ago
        > If people in my city can't afford housing because of AirBnB, it has negative impacts on my city as a whole. This is an externality, which--by definition--is a thing that isn't priced in. That's not an externality - the cost of housing is priced into AirBnB costs. Most "pricing out" happens because cities make it de facto illegal to build new houses, mostly because existing owners are quite happy with the resulting increase in their house prices (and renters don't vote).
        z9znz 4y ago
        I don't remember where it was in the US; maybe it was Cheyanne Wyoming or elsewhere, but it was a nature/mountain area popular with tourists. But their city leaders recognized the problem of tourist vs local housing prices, and they created regulation to ensure that there were enough local houses (affordable to locals). The problem in popular tourist areas is that more wealthy people can afford to come and stay for short periods and are willing to pay a lot, so owners of houses and apartments can make more money off tourists than locals. Naturally they choose the higher income option and go with Airbnb (for example). This leads to situations like Aspen, Colorado, where the "local" who work in Aspen have to live 30-60+ minutes away. They cannot afford to live where they work. And it means that in off seasons, these towns are just dead. Many shops close, there's no community, and there's little life. It might as well be a Disneyland which is only open for 8 months of the year. Amsterdam is a hugely popular tourist area. Granted the atmosphere, architecture, and museums are high value; but sadly I think also the weed focus is high (sorry). Whatever the reason, it means a LOT of tourists. In my small 10 years, I have seen an immense growth. Airbnb and cheap airlines like Ryanair have made it far worse. But to your point of housing prices, there has also been a lot of Chinese and other foreign property investment in Amsterdam (where the owners never intend to live there). Of course they seek to rent their properties, and short term rentals like Airbnb are generally more profitable in tourist areas. Still, this is not good for the cities or locals, and whether it's beneficial for visitors or not is effectively irrelevant. The city is nothing without happy locals.
        lmm 4y ago
    - piva00 4y ago
      How is it not an externality that local communities in Lisbon, Barcelona, Venice (among many others), who work and used to live in the city, are being pushed out of their own cities purely by landlords renting out their properties on AirBnB instead of offering as housing. Emptying cities is not great for any part of society, not even for the tourists that are the driving force of this. Venice is a hollow city, there's very few real people anymore in the center. Lisbon has been suffering for years with ever-increasing rents mostly driven by tourism pricing out the local population. There might not be enough dwellings and the housing market is much more complex than this but it's an enormous externality on local populations that they don't get close to fair compensation compared to being kicked out from your home. How exactly is this not an externality? Luddites and looms is a very different issue than a necessity as basic as shelter. When you found an analogy related to food or water we can use it instead.
      - lmm 4y ago
        > How is it not an externality that local communities in Lisbon, Barcelona, Venice (among many others), who work and used to live in the city, are being pushed out of their own cities purely by landlords renting out their properties on AirBnB instead of offering as housing. Increased demand pushing up the price is not an externality. > Venice is a hollow city, there's very few real people anymore in the center. And it contributes a lot more to overall human happiness that way. > Luddites and looms is a very different issue than a necessity as basic as shelter. When you found an analogy related to food or water we can use it instead. The Luddites were losing their whole livelihood - you can say all they lost was money, but without money they couldn't buy food or water or shelter. (Also, outside of a few climates cloth and clothes are every bit as much a basic human necessity as those)
        piva00 4y ago
        > And it contributes a lot more to overall human happiness that way. That's not the metric I look to optimise for, not sure why you believe I should take "overall human happiness" as the ultimate goal, some kind of weird min-maxing of real life, even less when dealing with things such as whole cities and communities, seems quite ideological to me. I really don't buy it.
    - lmm 4y ago
      Hotels and boarding houses do make an imposition on their surrounding communities. Having taxes and zoning requirements on them to compensate for that is reasonable, and most of AirBNB's "edge" comes from violating those laws.
      - z9znz 4y ago
        This should be an easy concept to grasp, but it seems that unless one has lived in an environment affected by this, they cannot understand.
        s1artibartfast 4y ago
        I am not arguing there is no causal effect, I am arguing that it is not a externality.
        cudgy 4y ago
        Noise pollution and additional crime experienced by neighbors from the short-term guests staying at Airbnb locations would qualify as an externality. Higher occupancy in Airbnb locations stresses capacity in pools, parking, gyms and other amenities of the neighborhood or complex is also an externality.
- z9znz 4y ago
  In Netherlands, most (all?) Ubers are actually cabs. And many of my NL Uber rides have thankfully been in the taxi cars which are well maintained Mercedes E or S class cars rather than some dude's 1995 Toyota Corrola. What Uber did that was great was provide an app where you could call a taxi. How they got ahead was by ignoring regulation which enabled them to provide lower fares and get more business. But Uber could not exist without traditional cabs. Or at least, something would fill the void of Uber if there were no cabs. There are many places in cities where cabs congregate to wait for passengers. Airports are probably the best example. People leaving airplanes often need a ride to their final destination. Imagine if everyone leaving the airport had to find a way to get local mobile service and then call an Uber. Eventually you'd end up with Uber drivers recognizing this need and parking themselves near the airport, ignoring calls, and choosing only nearby airport calls. The taxi industry needed a kick in the ass; there is no question. But all they lacked was a good software company and service. They did not need a fleet of regular dudes who happen to own cars and who get deluded into thinking they can have a real income from driving people around. The news is full of sad stories of people who struggle to get by as Uber drivers.
piva00 4y ago
Here on HN I got a reply some years ago about how these externalities and law-breaking are just the cost of innovation. 20 years into my career in tech I just get an itchy repulsive feeling when I hear innovation. It slowly turned to sound a little too evil.
- z9znz 4y ago
  I know this feeling, I think. There seems to be a personality type that is willing to entertain wild ideas and ignore "reality". Sometimes that results in actual new possibilities that nobody else was crazy enough to consider before. So there is potential value. But often it just means ignoring reality and reallocating the resources that are available in favor of a few. Tesla was a great company because they proved that electric cars could not only succeed but could accel (and accelerate! ... I do love seeing a family car kick a stupid ICE car's ass on the dragstrip. But they pushed too far, promoting self driving at the cost of lives. And for the anti-government people out there, Tesla would not exist had it not been for government funding. Even so, the guy at the helm had enough chutzpah to believe his own crazy big ideas and follow through with them. Unfortunately, he followed through well beyond the real successes and far into lunatic territory.
tptacek 4y ago
What's "market breaking"?
- p0pcult 4y ago
  I don't know what the actual economic term is (or if there is one), but what I am referring to is when a loss-running firm undercuts the competition until the competition no longer exists, and then because they have a monopoly, charges more and/or delivers a worse service than previously.

Well, I'd rather ride in an Uber than a cab and until very recently stay in an Airbnb rather than a hotel. For better or worse, they truly did disrupt those industries for consumers, much as non-customers might complain.

piva00 4y ago
> For better or worse, they truly did disrupt those industries for consumers, much as non-customers might complain. Ignoring all the suffering caused by the externalities on rental market caused by Airbnb in very touristic areas (e.g.: Lisbon, Barcelona, etc.), it's great for consumers. The issue is that none of these externalities are priced in, there is no compensation or fair counterpart for the victims of these companies. And somehow it all seems ok for some people...
- s1artibartfast 4y ago
  They aren't externalities and shouldn't be priced in. Should the luddites have been compensated by those who operated mechanical looms? If not, How are the situations different?
  - p0pcult 4y ago
    >They aren't externalities and shouldn't be priced in. If people in my city can't afford housing because of AirBnB, it has negative impacts on my city as a whole. This is an externality, which--by definition--is a thing that isn't priced in. An externality is defined as "a side effect or consequence of an industrial or commercial activity that affects other parties without this being reflected in the cost of the goods or services involved, such as the pollination of surrounding crops by bees kept for honey." >Should the luddites have been compensated by those who operated mechanical looms? UBI advocates might say yes; it's the whole idea that once some threshold of automation is passed, you won't have enough consumers to keep the economy running.
    - lmm 4y ago
      > If people in my city can't afford housing because of AirBnB, it has negative impacts on my city as a whole. This is an externality, which--by definition--is a thing that isn't priced in. That's not an externality - the cost of housing is priced into AirBnB costs. Most "pricing out" happens because cities make it de facto illegal to build new houses, mostly because existing owners are quite happy with the resulting increase in their house prices (and renters don't vote).
      - z9znz 4y ago
        I don't remember where it was in the US; maybe it was Cheyanne Wyoming or elsewhere, but it was a nature/mountain area popular with tourists. But their city leaders recognized the problem of tourist vs local housing prices, and they created regulation to ensure that there were enough local houses (affordable to locals). The problem in popular tourist areas is that more wealthy people can afford to come and stay for short periods and are willing to pay a lot, so owners of houses and apartments can make more money off tourists than locals. Naturally they choose the higher income option and go with Airbnb (for example). This leads to situations like Aspen, Colorado, where the "local" who work in Aspen have to live 30-60+ minutes away. They cannot afford to live where they work. And it means that in off seasons, these towns are just dead. Many shops close, there's no community, and there's little life. It might as well be a Disneyland which is only open for 8 months of the year. Amsterdam is a hugely popular tourist area. Granted the atmosphere, architecture, and museums are high value; but sadly I think also the weed focus is high (sorry). Whatever the reason, it means a LOT of tourists. In my small 10 years, I have seen an immense growth. Airbnb and cheap airlines like Ryanair have made it far worse. But to your point of housing prices, there has also been a lot of Chinese and other foreign property investment in Amsterdam (where the owners never intend to live there). Of course they seek to rent their properties, and short term rentals like Airbnb are generally more profitable in tourist areas. Still, this is not good for the cities or locals, and whether it's beneficial for visitors or not is effectively irrelevant. The city is nothing without happy locals.
        lmm 4y ago
  - piva00 4y ago
    How is it not an externality that local communities in Lisbon, Barcelona, Venice (among many others), who work and used to live in the city, are being pushed out of their own cities purely by landlords renting out their properties on AirBnB instead of offering as housing. Emptying cities is not great for any part of society, not even for the tourists that are the driving force of this. Venice is a hollow city, there's very few real people anymore in the center. Lisbon has been suffering for years with ever-increasing rents mostly driven by tourism pricing out the local population. There might not be enough dwellings and the housing market is much more complex than this but it's an enormous externality on local populations that they don't get close to fair compensation compared to being kicked out from your home. How exactly is this not an externality? Luddites and looms is a very different issue than a necessity as basic as shelter. When you found an analogy related to food or water we can use it instead.
    - lmm 4y ago
      > How is it not an externality that local communities in Lisbon, Barcelona, Venice (among many others), who work and used to live in the city, are being pushed out of their own cities purely by landlords renting out their properties on AirBnB instead of offering as housing. Increased demand pushing up the price is not an externality. > Venice is a hollow city, there's very few real people anymore in the center. And it contributes a lot more to overall human happiness that way. > Luddites and looms is a very different issue than a necessity as basic as shelter. When you found an analogy related to food or water we can use it instead. The Luddites were losing their whole livelihood - you can say all they lost was money, but without money they couldn't buy food or water or shelter. (Also, outside of a few climates cloth and clothes are every bit as much a basic human necessity as those)
      - piva00 4y ago
        > And it contributes a lot more to overall human happiness that way. That's not the metric I look to optimise for, not sure why you believe I should take "overall human happiness" as the ultimate goal, some kind of weird min-maxing of real life, even less when dealing with things such as whole cities and communities, seems quite ideological to me. I really don't buy it.
  - lmm 4y ago
    Hotels and boarding houses do make an imposition on their surrounding communities. Having taxes and zoning requirements on them to compensate for that is reasonable, and most of AirBNB's "edge" comes from violating those laws.
    - z9znz 4y ago
      This should be an easy concept to grasp, but it seems that unless one has lived in an environment affected by this, they cannot understand.
      - s1artibartfast 4y ago
        I am not arguing there is no causal effect, I am arguing that it is not a externality.
        cudgy 4y ago
        Noise pollution and additional crime experienced by neighbors from the short-term guests staying at Airbnb locations would qualify as an externality. Higher occupancy in Airbnb locations stresses capacity in pools, parking, gyms and other amenities of the neighborhood or complex is also an externality.
z9znz 4y ago
In Netherlands, most (all?) Ubers are actually cabs. And many of my NL Uber rides have thankfully been in the taxi cars which are well maintained Mercedes E or S class cars rather than some dude's 1995 Toyota Corrola. What Uber did that was great was provide an app where you could call a taxi. How they got ahead was by ignoring regulation which enabled them to provide lower fares and get more business. But Uber could not exist without traditional cabs. Or at least, something would fill the void of Uber if there were no cabs. There are many places in cities where cabs congregate to wait for passengers. Airports are probably the best example. People leaving airplanes often need a ride to their final destination. Imagine if everyone leaving the airport had to find a way to get local mobile service and then call an Uber. Eventually you'd end up with Uber drivers recognizing this need and parking themselves near the airport, ignoring calls, and choosing only nearby airport calls. The taxi industry needed a kick in the ass; there is no question. But all they lacked was a good software company and service. They did not need a fleet of regular dudes who happen to own cars and who get deluded into thinking they can have a real income from driving people around. The news is full of sad stories of people who struggle to get by as Uber drivers.

piva00 4y ago

Here on HN I got a reply some years ago about how these externalities and law-breaking are just the cost of innovation. 20 years into my career in tech I just get an itchy repulsive feeling when I hear innovation. It slowly turned to sound a little too evil.

z9znz 4y ago
I know this feeling, I think. There seems to be a personality type that is willing to entertain wild ideas and ignore "reality". Sometimes that results in actual new possibilities that nobody else was crazy enough to consider before. So there is potential value. But often it just means ignoring reality and reallocating the resources that are available in favor of a few. Tesla was a great company because they proved that electric cars could not only succeed but could accel (and accelerate! ... I do love seeing a family car kick a stupid ICE car's ass on the dragstrip. But they pushed too far, promoting self driving at the cost of lives. And for the anti-government people out there, Tesla would not exist had it not been for government funding. Even so, the guy at the helm had enough chutzpah to believe his own crazy big ideas and follow through with them. Unfortunately, he followed through well beyond the real successes and far into lunatic territory.

tptacek 4y ago

What's "market breaking"?

p0pcult 4y ago
I don't know what the actual economic term is (or if there is one), but what I am referring to is when a loss-running firm undercuts the competition until the competition no longer exists, and then because they have a monopoly, charges more and/or delivers a worse service than previously.