Why Uber and Lyft Make Congestion Worse
Uber and Lyft claim that allowing people to share cars will reduce the number of cars on the road. As described in this article by The Verge, a growing body of research shows that this is not at all the case. Instead, thanks to Uber and Lyft, people are taking more car trips and thus increasing traffic. Why does this happen? We can start by analyzing this situation as a game.
Sure, Uber and Lyft might (purportedly) be interested in reducing vehicle miles travelled, but their customers sure aren’t. Their customers are simply going to act according to their own benefit – that is, everyone will maximize their own payoffs. Before ride-hailing, commuters’ strategies consisted of walking/biking, driving, or taking transit. Now, with ride-hailing, the strategies are: walking/biking, driving, taking transit, and ride-hailing. The key takeaway here is that the addition of a ride-hailing strategy does not reduce the incentive to drive, and it certainly does not prompt people to ditch the option of driving entirely.
If driving is an option, then the payoff in terms of travel time is pretty much the same between driving and ride-hailing. However, the travel time of ride-hailing will always be better than walking or taking transit, so clearly ride-hailing will replace walking and transit, not driving.
Another factor when analyzing payoffs is monetary cost. On a per-trip basis, ride-hailing typically costs more than driving, so there appears to be even less incentive to take an Uber when you have the option of driving yourself. Of course, it may actually be cheaper to rely on ride-hailing entirely than it is to own a car when you take into consideration the costs of maintenance and insurance. However, people generally don’t take the time to weigh these long-term costs, and will choose the option that maximizes their payoffs in the short-term.
What does all of this mean? Trips that used to be by car will still be by car no matter what, but now trips that used to be made walking, cycling, or taking transit can and will often be replaced by an Uber or Lyft. We need to start looking more critically at ride-hailing companies like Uber and Lyft and the effects they have on congestion and carbon emissions, and we need to put more pressure on them to actively promote options that actually reduce vehicle miles travelled such as carpooling and taking mass transit.