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Philly ride-sharing bill passes state House, heads to Senate

Le 20 October 2016, 00:16 dans Humeurs 0

Philadelphia's long war with ride-sharing is close to ending. Late Wednesday afternoon the Pennsylvania House unanimously passed a bill legalizing the service throughout Pennsylvania, nearly a year after the bill originally passed the Senate and two years after UberX started illegally operating in Philadelphia.

The bill's passing isn't a done deal quite yet. Because of amendments made to the bill the Senate will have to vote on it again. After that it would reach the desk of Gov. Tom Wolf, who has supported ride-sharing legalization efforts.

While amendments have held up the bill for so long, this latest version contained an amendment that counts as good news for the Philadelphia School District. The bill dictates that ride-sharing companies must give 1.4 percent of their city revenues to the Philadelphia Parking Authority. The PPA will keep one-third of that money and dispense the remaining two-thirds to the school district. A previous version of the bill had a taxing plan that wouldn't have guaranteed the school district any funding.

The House's passing of the bill comes after a tumultuous month for ride-sharing in Philly. A temporary truce between Uber, Lyft and the PPA that was part of the state budget in July expired Oct. 1. About a week later, a Philadelphia judge ordered the ride-sharing companies stop operating in Philadelphia or face contempt of court. That ruling was scuttled by an injunction the next day.

Although passengers have never had to worry about repercussions from using the service, drivers have faced the threat of fines and the PPA impounding their cars. Those days will be ancient history if this bill gets through the Senate.

The bill essentially establishes guidelines for drivers, background checks, vehicular requirements and insurance, as well as a nondiscrimination policy and policies to ensure ADA passengers can use the services. It would require the ride-sharing companies to have at least 70 wheelchair accessible vehicles available in Philly by next June, with the possibility of adding up to 10 more vehicles per year in the coming years if the state determines more are needed to satisfy demand.


Computing the Social Value of Uber. (It's High.)

Le 9 September 2016, 11:55 dans Humeurs 0

How much would be lost if Uber simply went away? That's actually happened in Austin, Texas, and the service has faced legal troubles in France, Spain, Germany and parts of India.

How much is really at stake? A new paper by Peter Cohen, Robert Hahn, Jonathan Hall, Steven Levitt (of "Freakonomics" fame) and Robert Metcalfe comes up with a pretty good, dollars-and-cents measure of how much UberX, the main Uber service, is improving the lives of its users.

Based on their study, here are a few ways of framing the value of Uber ride services to Americans:

For a typical dollar spent by consumers on UberX, they receive $1.60 worth of gain.

That's an unusually high amount of "consumer surplus," as it is called by economists. It means there aren't that many close substitutes for Uber at prevailing prices, as moving people around is something the U.S. does not do especially well.

UberX produces daily social value of about $18 million.

That is comparable to having an excellent French impressionist painter produce a beautiful work each day and give it away for free.

UberX produces about $6.8 billion in social value a year.

If distributed across every American, that would be over $20 in benefits for each.

Are those numbers a lot or a little? They're not much compared to an $18 trillion gross domestic product, but they're probably a lot compared to other new companies. Either way, there is a more general point: If you consider those numbers to be small, then you don't have to worry about the taxi drivers who lose from Uber.

In general, the more consumers gain from lower prices from a new service, the more competing suppliers lose. (The same trade-off holds with foreign trade or immigration.) So if you are worried about the losers from Uber, you also should believe the gains for users are high. Alternatively, if you rave about the glories of Uber, consistency requires you to recognize larger distributional losses for competitors.

You might think that an economy can absorb progress only so rapidly, but since American rates of productivity growth have been low, it's difficult for this economist to see a strong case for keeping Uber out of transportation markets. Insofar as we should do something to help taxi drivers, that is best accomplished by general benefit and retraining policies for the unemployed, not by restricting innovation.

The researchers used an ingenious method for calculating the user benefits. Uber calculates figures for surge pricing at times of high demand, but it rounds off. So a computation of market conditions that might lead to a surge price that is 1.249 times higher than normal fares is rounded down to 1.2, but 1.251 would be rounded up to 1.3. Yet the initial, unrounded 1.249 and 1.251 estimates represent almost the same underlying market tightness.

Using data from Uber, the authors therefore could see how the demand for Uber varied with surge prices that vary (say from 20 percent to 30 percent above normal fares) even when market conditions are roughly constant.

If anything, this method underestimates the worth of Uber, as it doesn't capture what economists call "option value." Let's say you walk home with a guy or gal late at night, hoping something nice will happen. But you're not quite sure, as he or she might make the wrong noises about a particular political candidate, and then you would wish to bail out quickly. Uber would be the safety net. Most of the time you don't end up using the service or recording a transaction that would count for this study, but you can start making plans because you know you have Uber as a fallback.

Or consider those urban residents who have ditched their cars altogether. They know they can take Uber to the local market if they need to, even if most of the time they have not run out of milk and dog food. Similarly, the existence of Uber is helping some localities economize on mass transit expenditures.

The study also doesn't measure how Uber might help get the U.S. to the next level of market innovation, which in this case might mean a network of on-demand, self-driving vehicles.

Going beyond the work of the authors of this study, it is possible to try to tease out a better estimate the future of Uber. Do these consumer gains mean that Uber will convince local governments to let it operate without major hindrance? Or will that consumer surplus attract more market entrants into ride-sharing, possibly even Google, thereby eroding Uber's current dominance?

The real lesson here is an old one, namely that the fight between progress and protection never goes away. Progress is painful to some precisely because it is a big step forward for all the others.

This column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.

To contact the author of this story:
Tyler Cowen at

To contact the editor responsible for this story:
Jonathan Landman at


Digital ads invoke Uber, Lyft in state Senate races

Le 9 August 2016, 11:58 dans Humeurs 0

A Republican political action committee is up with two new ads today attacking Democratic state Senate candidates Joyce Woodhouse and Nicole Cannizzaro, part of a digital campaign the group kicked off last week.

Woodhouse and Cannizzaro's races are two of the biggest focuses for Senate Democrats this year as they fight to hold onto Woodhouse's seat in District 5 and Cannizzaro tries to to snag the open seat in District 6, currently occupied by Republican State Sen. Mark Lipparelli who is not seeking re-election.

Woodhouse will go up against charter school principal Carrie Buck in November, while Cannizzaro faces Assemblywoman Victoria Seaman.

The two digital ads suggest electing Woodhouse and Cannizzaro could cause Uber and Lyft to cease operating in Nevada if they support extra regulations on the ride-sharing companies during the next legislative session. The ads come amid reports that FBI background checks for Uber and Lyft drivers may resurface during the next legislative session.

The ads are paid for by the Nevada Jobs Coalition, a political action committee largely funded by Gov. Brian Sandoval's New Nevada PAC.

"Do you use Uber or Lyft?" one ad says. "You won't be able to if Nicole Cannizzaro's allies have their way." The second ad uses similar language to talk about Woodhouse.

Taxicab companies and some legislators have argued that the pre-employment checks that Uber and Lyft conduct on their own of their drivers are not as comprehensive as FBI background checks. Other legislators, however, have said that imposing extra regulations is part of an effort by the taxi industry to drive Uber and Lyft out of the state.

Woodhouse, for her part, voted twice in favor of the legislation during the 2015 session that allowed Uber and Lyft to return to Nevada. Since Cannizzaro has never held office before, she has no record to point to on either Uber or Lyft.

Senate Minority Leader Aaron Ford, a Democrat, pushed for FBI background checks for Uber and Lyft during the 2015 legislative session and has said that he thinks the issue is "ripe for discussion" in 2017.

Ford has said that he was disappointed that a report presented to an interim legislative committee in April meant to compare Uber's and Lyft's background check procedures with the FBI's process wasn't fully completed due to a lack of statutory authority and funding.

In response to the ads, Peter Koltak, spokesman for the Senate Democratic caucus, said that Buck and Seaman should be "ashamed" of "hiding behind the dark money group launching these shamelessly false attacks."

"Joyce Woodhouse and Nicole Cannizzaro have dedicated their lives to public service, and they will lead the fight in the state Senate to bring more new economy jobs to Nevada," Koltak said in a statement.


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