Monday, April 3, 2017

Bizarre New York Times Attack on Uber

By Robert Wenzel

I hope Uber realizes that someone has the long knives out for the firm.

The latest attack on the firm comes via The New York Times in a piece titled How Uber Uses Psychological Tricks to Push Its Drivers’ Buttons.

The article begins this way:
The secretive ride-hailing giant Uber rarely discusses internal matters in public. But in March, facing crises on multiple fronts, top officials convened a call for reporters to insist that Uber was changing its culture and would no longer tolerate “brilliant jerks.”

Notably, the company also announced that it would fix its troubled relationship with drivers, who have complained for years about falling pay and arbitrary treatment.

“We’ve underinvested in the driver experience,” a senior official said. “We are now re-examining everything we do in order to rebuild that love.”

And yet even as Uber talks up its determination to treat drivers more humanely, it is engaged in an extraordinary behind-the-scenes experiment in behavioral science to manipulate them in the service of its corporate growth — an effort whose dimensions became evident in interviews with several dozen current and former Uber officials, drivers and social scientists, as well as a review of behavioral research.
The piece then goes on to reveal in breathless fashion:
 Uber helps solve this fundamental problem by using psychological inducements and other techniques unearthed by social science to influence when, where and how long drivers work. It’s a quest for a perfectly efficient system: a balance between rider demand and driver supply at the lowest cost to passengers and the company.

Employing hundreds of social scientists and data scientists, Uber has experimented with video game techniques, graphics and noncash rewards of little value that can prod drivers into working longer and harder — and sometimes at hours and locations that are less lucrative for them.
Well, blow me down. It is as if The New York Times has just discovered behavioral economics, which by the way is as different from economics as is home economics.

Grocery stores for decades have been using BE by putting impulse items near cash registers. So have real estate agents (Get those home baked cookies out during an open house) and just about every other business, including, I might add The New York Times when it attempts to hook subscribers with trial subscriptions.

But when these type of techniques are used by Uber, "it's an extraordinary behind-the-scenes experiment in behavioral science to manipulate" drivers, according to The Times.

It should be noted that the article never even mentions the number of cash incentives that Uber offers drivers. Hey, cash incentive manipulations? Manipulate me more.

I ride Uber often enough to get some sense for what drivers think----especially since I ask them. I don't think I have ever come across an unhappy Uber driver. And this makes sense since if a driver was unhappy, he would quit and do something else.

What is most interesting though is that drivers all understand the cash incentives and BE methods that Uber uses and they all have some sort of specific plan to structure what is offered for their own lifestyle. Uber really provides very flexible options.for drivers and I have heard some pretty clever structures that drivers have designed for themselves to fit their own lifestyle and income desires.

The distorted focus of the New York Times piece has to be considered fake news.  Uber doesn't employ any techniques that haven't been around for decades.

BE simply recognizes that humans are, well, human. And Uber does the same. It is, for sure, a lot better option than the central planning, rigid rules of Taxi and Limousine Commissions.

Once again we see The Times support the central planning establishment against innovators and creators. That's a dying, cram it down readers' throats, behavioral model that is not going to work in the internet age,

Robert Wenzel is Editor & Publisher of and Target Liberty. He also writes EPJ Daily Alert and is author of The Fed Flunks: My Speech at the New York Federal Reserve Bank. Follow him on twitter:@wenzeleconomics, on LinkedIn and Facebook. The Robert Wenzel podcast is on  iphone and stitcher.


  1. If you don't like how Uber treats its drivers, then don't be an Uber driver.

    Why is this so difficult for some?

  2. I do have some sympathy for taxi medallion holders, as the value of those medallions has plummeted, but their anger should be directed at government, not Uber. The system should never have been created in the first place.

    As for the NYT, it's hard to know whether to be saddened or amused by their self-inflicted plunge in quality.

  3. 1. The NYT has a leftish slant. Shocker. My eyes are now open. Thank you for revealing hidden truths.

    2. Failure to acknowledge the merit gap between use of BE to influence purchasing habits of free consumers versus using it to manipulate and exploit an arguably captive labor force reeks of capitalist immorality.

    3. That experiencing 'x' number of rides in your area and having never encountered an unhappy Uber driver affords you even fractional insight into what drivers actually think is laughable. Moreover, your 'quit and do something else' remark is the most striking evidence of your total disconnect with the rideshare driver experience.

    1. Re point 2, are you serious or just being facetious? I don't see how a consumer voluntarily choosing how to spend his time and money is any different from a car owner choosing how to spend his time, car and money. Neither is "captive" to anyone. Both can choose to put their resources (money, body, car, etc.) to alternative uses. If their choices are not great, that's not the fault of the vendor contracting with the consumer or Uber contracting with the driver.

    2. Explain how the labor force is "arguably captive"

    3. Buyers and sellers of anything will attempt to manipulate the other party. It's the same thing in labor and equipment as anything else. Does an employer put in a fitness center because it's a nice thing to do or does it put it in so people will stay at work longer and/or it will reduce medical care outlays?

      With regards to the uber/taxi situation, the traditional medallion taxi system is far more captive than uber. Those drivers who have to lease a medallion owner's cab have far less choice and the cabby who has his own medallion has to work to pay off the loan on it. That doesn't make uber wonderful just less captive.

      Much of what uber's app does it get around the hailed cab laws that prevented people from simply giving people rides for money. If government hadn't interfered in the first place then uber's app would be much different and it much less able to dictate terms. It would have to sell itself as a tool for drivers who already had established their own businesses.

  4. The NYT has just discovered corporations behaviorally manipulate employees and contractors that work for them? And?

    If the media keeps up their current rate just about everything that's true and often obviously so but ridiculed as a conspiracy theory will become conspiracy fact so long as it is some enemy of the left doing it within a year or so.