Show Me the Way to Go Home: An Empirical Investigation of Ride Sharing and Alcohol Related Motor Vehicle Homicide
35 Pages Posted: 31 Jan 2015 Last revised: 16 Dec 2016
Date Written: January 29, 2015
In this work, we investigate how the entry of the ride sharing service Uber influences the rate of alcohol related motor vehicle homicides. While significant debate has surrounded the entry of driving services such as Uber and Lyft, limited rigorous empirical work has been devoted to uncovering the societal benefits of such services (or the mechanism which drives these benefits). Using a difference-in-difference approach to exploit a natural experiment, the entry of two Uber services into markets in California between 2009 and 2014, we find a significant drop in the rate of homicides after the introduction of Uber. Furthermore, results suggest that not all services offered by Uber have the same effect, insofar as the effect for the Uber Black car service is intermittent and manifests only in selective locations (i.e. large cities). These results underscore the coupling of increased availability with cost savings which are necessary to exploit the public welfare gains offered by the sharing economy. Practical and theoretical implications are discussed within.
Keywords: Uber, sharing economy, ride sharing, drunk driving, vehicular homicide, difference in difference, natural experiment, platforms
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