According to Survey, Uber's Presence Did Not Affect Income of Cab Drivers

10/31/2017 - 10h16

According to two academic papers and a yet-to-be-published survey conducted by the Administrative Council for Economic Defense (Cade), the main effect that Uber and other similar apps have had was extending their services to new customers.

According to a paper written by economists Cristiano Aguiar de Oliveira and Gabriel Costeira Machado at the Federal University of Rio Grande (Furg), Uber's presence has not affected the average income of cab drivers in seven state capitals.

Their research took into account the numbers of the Brazilian Institute of Geography and Statistics (IBGE) on the incomes of cab drivers in the nine months leading up to, and the nine months following, Uber's arrival in Brazil.

The results strengthen the conclusion that the survey conducted in 2015 by Cade (a federal agency that seeks to implement free competition): in the cities it operates in, Uber did not reduce the number of passengers picked up by cab drivers.

A new study conducted by Cade, that has yet to be published, concludes that the company's arrival in Brazil strengthened competition by reducing the cost of transportation, increasing availability and expanding market size.

However, union representatives claim that the incomes of cab drivers have gone down. "If they weren't affecting us, we wouldn't be demonstrating on a national level", said Dirceu Vilarino, a director of the cab driver union in the city of Belo Horizonte, who believes that income has dropped by 50%.

But decreases in income may also be explained by the economic recession that took place in Brazil between 2014 and 2016, according to economists.

Mr. Oliveira pointed out that those who have been affected the most by new technologies are the owners of cab licenses, given that the licenses have significantly decreased in value in the second-hand market.

"Drivers can now choose the kind of work that will provide them with the highest income, particularly those who drive fleet cars".

Translated by THOMAS MATHEWSON

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