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February 19, 2018

Economics Study Finds Gender Pay Gap Among Uber Drivers

A gender pay gap among Uber drivers was recently discovered in a study conducted by a group of five economists: two from Uber, two from Stanford, and one from UChicago, economics professor John List.

The study reports that, on average, male Uber drivers earn 7 percent more than female drivers.

The study explains that Uber’s payment algorithm does not factor in gender, so payments from Uber should be equal between men and women for the same amount of driving. Pay discrimination cannot come from passengers either, because passenger ratings do not affect how much drivers are paid.

In an interview for Freakonomics Radio, List said that if there were any pay gap, he would expect it to favor women.

“I knew that [women] had worked fewer hours per week [in their other jobs],” List said, “so they had a chance to cherry-pick the better hours during the week [when working for Uber].”

However, the study upends this hypothesis. The researchers offered three reasons for male drivers’ greater earnings: experience with Uber, where and when they choose to work, and driving speed.

The study explains that Uber drivers gain experience at their job over time. The drivers who have worked with Uber longer know how to earn more money than those who have just started.

The researchers found that male drivers typically work for Uber longer than female drivers. Seventy-six percent of female Uber drivers leave the platform after six months, while only 63 percent of male drivers leave after the same amount of time. Therefore, men make up a larger percentage of Uber’s most experienced drivers.

The researchers also found that male drivers tend to choose the most profitable times and places to work. For example, rides to and from the airport are some of the most profitable rides Uber drivers can take. For unknown reasons, male drivers tend to pick up more of these rides than female drivers.

Finally, the researchers found that male Uber drivers drive 2.2 percent faster than female drivers. Since men drive faster, they take less time to complete the same fare as female drivers. The faster driver can also pick up more fares in the same amount of time as the slower driver. Speed is the largest reason for the pay gap, according to the researchers.

When asked how to eliminate the pay gap, Jonathan Hall, who heads public policy and economics for Uber, told Freakonomics, “We want to dive much deeper into this, to understand what the space of potential interventions looks like in order to reduce the gender gap.”

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