Taxi Drivers Rally In Favor Of Stricter Regulations For Part Time Car Service Drivers (Photo : Getty Images)
A study by researchers at the Northeastern University on car-hailing services in New York and San Francisco cites anecdotes how Uber drivers create shortages and increase fares.
Since the "law of supply and demand" applies to Uber and other vehicle-hailing services, Uber drivers create shortage by deliberately going offline, reports The New York Post. The shortage makes it justifiable to increase prices.
When drivers do that by colluding, Uber app users get the message: "Demand is off the charts! Fares have increased to get more Ubers on the road."
However, the daily advises passengers to beat this method by waiting for a few minutes and walking a few blocks. That's because, 40 percent of surges in demand often lasts only for five minutes and 70 percent in 10 minutes.
The Big Apple has 16 surge areas with its own price, which depends on customer demand in any one of the area's perimeter. For Uber users in Times Square, riders could save 50 percent or more by transferring to an adjacent surge area, advise the researchers.
But Uber says the study covered only four weeks of surge-pricing data in San Francisco and Manhattan and dismissed the findings as "extremely limited."
Meanwhile, The Verge reports on Friday that Uber pulled out of the German cities of Hamburg, Frankfurt and Dusseldorf. The company blamed complex regulations for the decision to pull out. The three cities has a total population of 2.98 million residents.
