Re: [projectvrm] Uber scores and so do we

[Don Marti < >]

begin Phil Windley quotation of Sat, Jun 07, 2014 at 08:45:29PM -0600:

> FWIW, those are pretty crappy jobs that deserve to be destroyed. We 
> romanticize them (‘ala Judd Hirch and Jim Croce), but in fact they don’t 
> pay much. In NYC, hardly any taxi driver owns the medallion (otherwise 
> known as the government giving you permission to work). Most medallions are 
> far our of range for the driver who is a low wage employee of the person or 
> company who does own a medallion. Here’s the average price of medallions in 
> NYC for May 2014 (PDF) 
> http://www.nyc.gov/html/tlc/downloads/pdf/avg_med_price_2014_may.pdf  >$1M. 
> Wanna buy one?  No one’s stopping the taxi driver from join Uber and 
> driving for them, so not sure how jobs are being destroyed. 

With about 13,000 New York City medallions in
existence, that comes to about $13 billion.
Boston medallions put together are less numerous
and less expensive (1785 at about 700 grand each,
so that's another 1.25 billion.)

Uber's market cap is around $17 billion.

  
http://www.businessweek.com/articles/2014-06-06/q-and-a-travis-kalanick-on-ubers-new-17-billion-valuation

So the too-simple version of the story is that one
form of capital (government-issued medallions) is
going down in value, and another form of capital
(network value of Uber's customer and driver
relationships) is going up.

But wait a minute...

  "If Uber Is Killing Taxis, What
  Explains the Million-Dollar Medallions?"
  
http://www.businessweek.com/articles/2014-02-28/if-uber-is-killing-taxis-what-explains-new-yorks-million-dollar-medallions

  Prices are up in Chicago too...
  http://chicagodispatcher.com/chicago-taxicab-medallion-prices-p235-117.htm

Shouldn't the price of the substitute good (from the
driver's POV) be going _down_?

My guess (and this could easily be bogus) is that
the existence of additional transportation services...

 * Car-sharing (Zipcar, City CarShare)

 * Ride-sharing (Uber, Lyft)

 * Conventional taxis

 * Conventional public transit

...makes it more likely that a two-car household in
a major metropolitan area will go down to one car.
If a household normally has Mom take BART and Dad work
from home, they still need two cars for peak driving
days (when Dad had to take Junior to apitherapy and
Mom has a meeting in Santa Clara).  If there's a usable
mix of options for those both-drivers-drive days, they
might stick with one car.

  
http://www.thestreet.com/story/12311758/1/car-sharing-might-destroy-the-auto-market.html

So more, not fewer, total taxi rides will be sold in
an Uber-rich environment, because taxis are another
option for replacing car trips.

-- 
Don Marti                    
http://zgp.org/~dmarti/