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Is Uber a Threat to Democracy?

AIX-EN-PROVENCE – Every July, economists, business leaders, NGOs, and politicians from around the world gather in Aix-en-Provence, France, for the three-day Rencontres Économiques forum, organized by the Cercle des Économistes. This year’s forum focused on the changing nature of work. The timing of the meeting, which coincided with a heated debate in France about the innovative ride-sharing service Uber, could not have been more apt.

The forum’s theme was undoubtedly selected partly in response to fears that technological advances will lead to widespread unemployment, as machines become advanced enough to replace humans in performing an increasing number of tasks. As MIT’s Andrew McAfee pointed out, historically, technological revolutions have “eventually led to more, if different, jobs”; but, with machines becoming increasingly intelligent, “this time may be different.

Given this possibility, McAfee suggests, we may need to re-build our societies so that, as intelligent machines increase productivity, the declining demand for human work has welfare-enhancing outcomes like higher (and more equitably distributed) incomes and more leisure time. He is not alone: John Maynard Keynes predicted this possibility 85 years ago.

Uber, which enables people to connect with available drivers through a smartphone app, is precisely the kind of disruptive company that is driving the shift. Taxi drivers in France and around the world are particularly incensed about UberPOP (called UberX outside Europe), a no-frills service. Uber has since withdrawn UberPOP from France, at least temporarily – though not before two of its top managers were arrested for ignoring the government’s injunction to suspend UberPOP.