All aspiring business-people are die-hard capitalists – until they have to compete. Such a fact is visible in the Taxi industry’s fight against Uber, Lyft, and similar ride-sharing services.
The taxi industry had previously been protected by the massive costs of obtaining a medallion to enter the field, which increased in price every year. It was a large and expensive barrier to entry. It also guaranteed little competition from those who couldn’t afford to compete. Services like Uber changed that, and rather than try to offer superior (or cheaper) service, taxi companies have turned to politics. Most of Uber’s competition comes from politics, not their business competitors, as they’re banned from operating in a handful of U.S. cities.
And what have been the consequences of such bans? Not only has it benefited the dinosaurs in the taxi industry who fail to innovate, it’s led to skyrocketing rates of DUIs in those cities.
After the city of Austin passed new burdensome regulations on the ridesharing economy last summer, Uber and Lyft both decided to cease operating within city limits. In the several months since their departure, driving under the influence (DUI or DWI) arrests have already spiked according to the Austin Police Department’s own data.
Before Uber came to town in 2014, Austin Police Department’s data showed that the city had an average of 525 drunk driving arrests per month. When these numbers were revisited a year after ridesharing came to Austin, drunk driving arrests had dropped by five percent. This trend continued the following year when the number of drunk driving arrests dropped by an additional 12 percent, bringing the average number of arrests to about 438 per month.
In May of 2016, the same month Uber and Lyft made the decision to leave Austin, the monthly rate of drunk driving incidents was down to an average of 358. However, within the first few months of Uber and Lyft’s absence, the number of DUI arrests increased by 7.5 percent from the previous year. In the month of July alone, the city had 476 drunk driving arrests.
For anyone who hasn’t used Uber before, it does make sense that a removal of the service would lead to an increase in DUI rates. Someone can order an Uber simply by pressing a button on their phone, which will pick up on your location and send a driver your way. You’ll even know what the ride costs ahead of time (generally speaking, the cost of an Uber averages half that of a traditional taxi). It’s so intuitive, even a drunk could do it!
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