Saturday, May 9, 2015

An intellectual journey of a million miles

Began, for a young Philadelphian journalist
Emily Guendelsberger Emily is senior staff writer at Philadelphia City Paper. She enjoys writing about feminism, opera, television, arts ecosystems, music theory, people with weird jobs and pretty much everything involving money.
with the idea lodged in her head that a job is a job, apparently. While we applaud the attempt to experience first-hand what it's like to driver for Uber, it would have been a better article had she realized that she was a partner in a business venture and not an employee. Which is why trying to guage how much someone earns per hour, without thinking about the opportunity costs--which differ for different people--involved.
Until the week this article published, the only numbers Uber would discuss were gross fares — that's the total amount drivers bring in, not the lower amount they end up with after expenses and Uber takes its percentage. On top of that, Uber employs different rates in different areas. Taking an UberX in the Hamptons is vastly more expensive than in the lowest-rate areas like Nashville, Providence and L.A.
To which we can only say; Duh! To her credit, though she does get half the equation (the important half; there's a need);
Whatever my reservations about Uber as a driver, it really, really is better for riders. I'm actually a staunch defender of Philly cabbies — I've never met a bad one, though many vocal people have. But Uber is just ... better. The current medallion system sucks. Without getting too into the regulatory weeds, it creates an environment that screws over drivers and has no financial incentive to provide a pleasant experience for passengers. Uber can provide better service at cheaper prices with UberX because, by refusing to work within the medallion system, it has far fewer costs than a regulated taxi company — the cost of medallions, owning and maintaining a fleet of cars and paying for full commercial insurance. It's not surprising that taxi medallion systems in cities all over the world are losing customers to Uber like crazy.
Our bold in the above. Unfortunately the overwhelming bulk of the article is about the difficulties of the drivers and how little money they're left with after expenses. A concept rather elementary to anyone who has ever taken a course in accounting or economics.  Which Emily clearly hasn't.

Unfortunately she is oblivious to the reality that many people do choose to drive, and earn money, working with Uber. A bit of evidence one would think would alert her to the fact that such people consider themselves better off by doing so. Otherwise they would quit, which Emily herself did, presumably because she has better opportunities.

No need to read newspaper articles, the marketplace gives all the information needed.

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