Uber Bad Effects On The Economy

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Is history repeating itself? Let’s go back in time to the Great Depression, where there were no rules or regulations concerning the taxi industry. During this time, citizens of the United States of America were deciding to take a stab at joining the taxicab market by the means of driving unlicensed taxicabs due to the high amount of unstable jobs. Although these people were employing themselves, they were causing various negative effects throughout the country. Some of which were an increase in accident rates, poor insurance coverage and high traffic levels. Due to these side effects, laws and regulations were quickly enacted to govern safety, driver rights issues and many other concerns. After around forty years of success with these taxi …show more content…

Just a few years passed with the unregulated taxi industry until it was determined a failure and the majority of the cities previously stated re-enacted their regulations. With the up and coming ride-sharing app, Uber, we could be facing problems very similar to the ones we faced during the anti-regulation movement such as higher prices, lower quality of vehicles and drivers, unpredictable fares, riders in low-density areas being neglected and many more. Uber has been growing immensely since it was created 5 years ago with a major reason being because it is not regulated nearly the same as regular taxi services. Uber proponents are preaching that the monopolistic, overregulated city cab services need to be broken down. With Uber on the rise, we can expect to see a decrease in the quality of service as inexperienced and unprofessional drivers will be behind the wheel. We can also expect a rise in price with Uber’s “surge pricing” which encourages their drivers to drive more and during peak …show more content…

Although Uber has plenty of negative consequences, it also has some upsides to it as well. Uber creates significant economic activity and opportunities. For the city of Chicago, Uber’s operations added a total gross impact of $46,380,000 in 2013 and counting as the company booms. There have also been approximately 25,000 supplementary rides and over 1,000 gross jobs established that could not have been created without Uber. The city of Long Beach, California has a simple solution to the turf war between Uber and Taxis. William Rouse, the general manager of Long Beach Yellow Cab argued that the decline in taxi ridership is due to “the increased competition from businesses that don’t face the same regulatory burdens.” The city council of Long Beach and Yellow Cab worked together for a solution allowing for discounted fares as conditions warrant, an ordering app, an increase in fleet size from 175 to 199 cabs and permission to add additional capacity at peak times. This solution provides a more fair approach for the two companies which results in a more equal competition allowing both companies to

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