Uber and Lyft are only economically viable because they offload their cost of capital -- the investment and depreciation on cars and the cost of keeping a driver fed and healthy -- onto the drivers, who are only willing to accept such a bad deal because the labor market sucks.
Businesses that can't cover their costs of capital are not sustainable without some source of subsidy (like the food-stamps for McDonald's and Walmart workers that we all pay for). If the labor market improves and workers decline to continue to subsidize rideshare companies they'll need to find some way to get the government or the capital markets to subsidize them or they'll collapse.
The market will not miraculously produce a capital replacing living wage. If it does so in any particular market it is happenstance; luck, not social physics.
This is a social action problem; a race to the bottom issue. It makes sense, individually, to race to the bottom. Company execs and investors get rich, consumers get cheaper rides and drivers get money they need. But this isn’t win, win, win. It is win, win, lose over the not very long run.
The cheaper wages paid to drivers, and thus the cheaper rides, also drive business with capital structures which make social sense out of business. They can’t compete with “drive your car into the ground, make less than minimum wage”.
The Market Fairy will not solve the problems of Uber and Lyft
(Image: Uber Sidecar Lyft, Colin@TheTruthAbout, CC-BY-SA)
(via Naked Capitalism)
Some 1,600 people were secretly livestreamed while staying in South Korean motel rooms where cameras had been hidden by criminals who operated a 4,000-user service for voyeurs, where a $45/month upcharge bought subscribers the right to access replays and other extra services.
Last year, California was one of several states to introduce right to repair legislation that would force companies to end practices that discourage the independent repair sector, creating a requirement to sell replacement parts, provide documentation, and supply codes to bypass DRM systems that locked new parts out of devices until the company activated them.
The term "meritocracy" was popularized in the UK sociologist Michael Young's 1958 novel, "The Rise of the Meritocracy," in which aristocrats insist that they are the natural rulers of their society based on "objective" measures of worth ("merit" + "aristocracy" = "meritocracy") that are obviously tilted to favor them, a fact that they are conveniently […]
If you’re a Mac user, you thrive on simplicity. Everything in its place and a place for everything. Unsurprisingly, there’s a ton of great organizational apps out there for Mac, and now someone’s had the great idea to bundle them all together. Whether you’re running a demanding business or just getting through the day to […]
Seems like drones are doing a lot of jobs these days, from reconnaissance to delivery. Now, we can add “keeping the Death Star safe” to that list. Whether you’re a drone enthusiast or a Star Wars fan, these Star Wars Propel Drones are undeniably the coolest toy around. Yes, that’s a fully functional drone replica […]
It’s spring clearance time for the Boing Boing Store, when some of the best deals from the holidays return even cheaper than before. From top-rated apps to educational software to the cutest record player of all time, they’re all back with a little extra incentive. Shop your heart out before tax season wraps up! Use […]