How Market Forces Undermine Racism: Uber Cab Edition


For a little over five years I lived in Harlem's famous Sugar Hill neighborhood, where the rent was cheap and I was surrounded by the echoes of history. My favorite local landmark was the stately apartment building where both W.E.B. DuBois and Thurgood Marshall once lived. One of the downsides of the neighborhood was that I could never, and I mean never, find one of New York City's otherwise ubiquitous yellow taxis when I needed speedy passage to lower Manhattan or a ride to the airport.

This anecdote would not surprise any longtime New Yorker. The city's yellow cabs, which enjoy a legal monopoly over the right to pick up paying customers on the street, are notorious for avoiding black neighborhoods (and customers). As a result, when Harlem residents wanted to hail a ride we turned to what New Yorkers call "gypsy cabs," essentially private car service drivers who pick up illegal street fares between appointments. These drivers negotiate their price on the spot and provide a much-needed service to willing buyers. In other words, a black market in taxis sprung up in order to fill the void created by government-empowered racism from the taxi cartel.

This little trip down Damon Root's memory lane was inspired by a very interesting post at the site Racialicious by the writer Latoya Peterson. Her subject is the hot new private car service Uber, which allows customers in a handful of big cities to purchase prompt, taxi-like service at the touch of a smart phone. Unsurprisingly, Uber is not exactly popular with the established taxi regimes in those cities. Indeed, in places like Washington, DC, the yellow cab cartel has turned to its allies in local government in an effort to eliminate this new high-tech competition.

Peterson adds a new dimension to the Uber controversy. As she notes, "most analysis of Uber's costs and benefits leave out one huge piece of the appeal: the premium car service removes the racism factor when you need a ride." As she explains,

In 1999, actor Danny Glover made headlines by filing a taxi discrimination claim in New York City, noting that cabs failed to stop for him due to the color of his skin. Good Morning America experimented with having a black man and a white man hail cabs again in 2009, and found that the racial profiling still continued. In 2010, Fernando Mateo, Head of the New York State Federation of Cab Drivers encouraged racial profiling in the name of safety. Though it has been over a decade since Danny Glover made the issue a national conversation, the landscape hasn't changed much.

As a black woman, I am generally seen as less of a threat than my black male peers. But that doesn't mean my business is encouraged or wanted.

Peterson goes on to narrate her own various positive dealings with Uber, though her post is by no means a love letter to the company. She is especially critical of Uber's high cost and "shady 'surge pricing' practices." But at the same time she raises an essential point: Market forces can and do undermine even the most well-entrenched forms of racism and discrimination. Here's hoping Uber inspires many competitors of its own, bringing even more choice to the transportation market in American cities.

For more on the debate over Uber, see Katherine Mangu-Ward's "Post-Sandy Price Gouging by Uber?" Econ 101, in Twitter Form."

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  1. One of the first things that we learned in employment-discrimination law was that market forces tend to go against bigotry. Of course, government has to step in to correct that particular market failure. Progressives hate it when I point that out to them.

  2. What does it say about American racism when the vast majority of NYC cab drivers are named Mohammed Muhammed al-Muhammad and they’ve just arrived from Pakistan 2 weeks ago?

    1. No kidding.

      I hate to be ‘that guy’, but let’s cross-reference cabbies who get robbed with the race of the robber and declare the bias “optically bad but still rational”

      Next Damon is going to tell me that less people walk down alleyways at 2 AM in Sugar Hill than do so in the UWS, UES or the Village.

      1. and there is the argument. Damon wants to ignore that there may be a reason cabbies make the decisions they make. But we cannot allow malicious truths to get in the way of guilt-inducing narratives, now can we.

        1. At the same time, however, I think that there would be plenty of people who would be willing to take that risk and factor it in, and the cabbies market guild won’t let that happen.

          1. Exactly…the black market taxis mentioned in the article have proved that there are people who will fill that void, no matter how dangerous. It’s the government-sanctioned cartel that refuses to allow anyone to fill the void legally.

            1. And just what do you mean by black market?

          2. since the guild is not likely to give up power, I have no problem with the gypsies. If they see a market opportunity and believe the risk-reward ratio is in their favor, let ’em at it.

            Agree with your premise but cartels are cartels for a reason.

            1. tl;dr America isn’t racist, it’s rational, and go free markets.


        2. “Damon wants to ignore that there may be a reason cabbies make the decisions they make.”

          I don’t think he wants to ignore that. It really isn’t relevant to the post. I think he wants other services to be allowed which might encourage to taxi drivers to decide differently. Why taxis don’t like to pick up black people is a different issue altogether.

          1. Why taxis don’t like to pick up black people is a different issue altogether.

            Damon’s answer is racism. It’s right there in the headline.

            1. The headline more appropriately could be called “how the market expands into high-risk pools”

  3. In 1999, actor Danny Glover made headlines by filing a taxi discrimination claim in New York City, noting that cabs failed to stop for him due to the color of his skin.

    Now they don’t pick him up because of 2012.

    1. He’s getting too old for this shit, FoE.

      1. He does have a traveling saxophonist follow him around and play music cues throughout his day.

      2. Beat me to it, Epi. I was looking through Youtube for a nice little clip. So at least my comment has audiovisuals.

  4. It’s racism but not b/c black people are viewed as a criminal threat. It’s b/c black people tip worth shit.

  5. I had a hilariously racist Peruvian cab driver the one time I went to New York. The reason New Yorkers are such assholes on the road, it turns out, is because there are so many black people driving. Dey got de more hot blood, you know?

    1. That is rich coming from a Peruvian. Ha!

      The worst black driver in the US is worlds better than the best peruvian driver.

      1. I should mention that my step-mother is black and peruvian. She has totaled about 4 cars and had countless fender benders. I refuse to ride with her driving.

        I am stunned that she hasnt killed herself or anyone else.

    2. NYC was also where I witnessed an African-American truck driver hurl every anti-black racial slur I’d ever heard–and a few new ones–growing up in the awful racist South at my African immigrant cab driver in an epic 3 minute litany, while barely pausing for a breath.

      1. The world is a rich and wonderful tapestry of hilarious hate.

      2. But it’s different when we say it.

        1. It was the thoroughness and speed that impressed me. The cabbie didn’t even bat an eye, which means he’d heard it many times before.

          1. Just like Poles know all the best Polish jokes.

            Naive, 17-year-old me came in for a rude awakening when a fellow basic trainee (black) went on a racist tirade against a Drill Sergeant (behind his back, natch) for being darker than he was.

            So weird.

            1. The house and field conflict never died.

              1. I liked Chalky White’s house nigger tirade on Boardwalk Empire when his daughter brought in her medical student boyfriend. Michael K. Williams never disappoints.

                1. I assed fo’ hoppin’ John!

                2. Williams does barely suppressed rage better than anyone.

                  1. Any other show this may make sense…

                    But Boardwalk Empire has Stephen Graham as Al Capone and Jack Huston as Richard Harrow.

  6. of course, profiling exists and we all do it every day to some degree. Whether it’s our choice of neighborhoods in which to live, restaurants to patronize, people to hang out with, or a host of other decisions, choices are made on a combination of experience and belief.

    Maybe beliefs get magnified but they are based on some reality. If cabbies were robbed with any frequency while dropping off folks on Park Ave, they would stop taking fares there, too.

    1. Maybe if the cabbies could arm themselves…

      1. I don’t know how much that would help if someone sitting behind you is robbing you. Now if they could booby trap their cabs…

  7. In commerce the only color that matters is green. Barring other factors I am sure a cab driver is just as happy to be paid by a darkie as by a cracker.

    It could be that there is some other factor involved here…what could it be?

    1. if I wanted to be hilariously ironic, I would say it’s the blue color of a Niggertown Saturday Night Special that keeps the Democratic politicos of NYC up late at night.

      But I have no hilarity today.

    2. a darkie and a cracker….so, that diversity training is working, is it?

      1. The whole racism meme has worn out on me long ago. I know very few people who actually are racist in the classic sense. The people that use it for ulterior motives are legion.

        Racist terms have become meaningless to this redneck peckerwood cracker.

        1. I bet your racist sprinkler says “spic spic spic spic spic spic spic chink nigga nigga nigga nigga nigga nigga”

          1. Little black boy: My dad’s car has a horn that goes “hoooonkeeeeey!!”

            Little white boy: Oh yeah, well my dad has a chainsaw and it goes “ruuuuunnnnniggerniggerniggernigger!!!”

  8. Let us test cabbies for racism. here is my proposed test;

    Have two guys on opposite sides of the street hail the cab at 2am on a deserted street. One of them is a white guy wearing a hoodie with tattoos on his neck and a gold tooth. He has one hand in his pocket.

    The other one is a really dark black man wearing a nice suit and tie with a brief case.

    1. You mean, like this guy?…..ouzone.jpg

      1. There are exceptions to every rule, but stereotypes dont exist for no reason. ( the bowtie would make me suspicious )

        From what I read there ( I dont watch the wire ) it seems unlikely a cabbie would have anything to fear from that imaginary character.

      2. I don’t think Brother Mouzone was robbing any cabbies.

      3. I would give a ride to a Malcolm X lookin dude over the white tattoo guy with a hoodie.

        For some reason I imagine the Malcome X dude only holding me in contempt and lazerbeaming the back of my neck with his eyes.

        On the other hand I imagine the white dude slitting my throat.

        1. I stopped at a traffic light in a black part of town once. A bowtie, suit wearing black guy walked up to my muddy jeep and knocked on the window. I rolled it down. He held up a copy of Louis Farrakhan’s newspaper for me to buy. I looked him dead in the eye and said in a flat voice ” You are kidding right?”

          We both cracked up laughing.

          For an instant it was hilariously obvious that the groups we divide ourselves into are superficial and artificial.

          Then he went back to selling that rag and I went to work.

    2. One of them is a white guy wearing a hoodie with tattoos on his neck and a gold tooth.

      I’ve been informed by Reason commenters that SWPL college kids wear hoodies therefore criminals don’t, or something.

  9. Fundamentally the only way to limit certain races is to limit resources and their access to those resources.

    Racism cannot exist in a free market. Yes some individuals could deny services to some groups but if they deny those services that would only open that market to competitors.

    1. But, but, but … not fair!

    2. I think that’s a nice story, but racism can certainly exist in a free market. For example, a small mom-and-pop convenience store in the rich/poor part of town can race discriminate against one or more races because there’s likely a predominant race in the area.

      1. To add to that: note that the post is carefully titled “How Market Forces Undermine Racism”, not “How Market Forces Eliminate Racism”.

        I’d be surprised if Uber Cabbies were, all else equal, less racist than other cabbies. But, qua cabbies, they act as if they’re less racist, whatever their beliefs.

      2. As I said:

        but if they deny those services that would only open that market to competitors.

  10. Sometimes dude you jsut gotta roll with it.

  11. I dressed as Travis Bickle for Halloween one year. Nobody got it.

  12. After all these years shouldn’t they be called Asian cabs by now?

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