1. Home
  2. Uber CEO says MIT study 'incompetent,' authors promise revision

Uber CEO says MIT study 'incompetent,' authors promise revision

by Justin King

Critics suggest the MIT survey questions are confusing and may have led to a significant error in reported income.

Researchers behind a controversial study of ride-hailing driver pay have agreed to review their analysis after Uber executives pointed to several issues that may have resulted in fundamental errors.

The study, published by the Massachusetts Institute of Technology, claimed that Uber and Lyft drivers make a median profit of just $3.37 per hour when all costs and vehicle depreciation are factored in. The findings are based on survey responses from more than 1,100 drivers.

Uber CEO Dara Khosrowshahi derided the report on Twitter, labeling MIT 'incompetent' and pointing out that the conclusions do not align with other academic studies and surveys.

MIT = Mathematically Incompetent Theories (at least as it pertains to ride-sharing). @techreview report differs markedly from other academic studies and @TheRideshareGuy recent survey. Our analysis: https://t.co/S2aAqCuDR0

— dara khosrowshahi (@dkhos) March 3, 2018

In a blog post, Uber chief economist Jonathan Hall claims the MIT report's earnings findings are less than half the hourly earnings numbers reported in the survey that underpins the paper.

"That survey, conducted by The Rideshare Guy in 2017, reports average hourly earnings of $15.68," Hall notes.

The executive suggests the MIT researchers applied "inconsistent logic" to interpreting data from specific survey questions that asked respondents how many hours they work per week on average, how much money they make in an average month and how much of their total monthly income comes from driving.

"This inconsistency leads to flawed methodology that results in hourly earnings numbers that are far, far below what any previous study has found," Hall says.

Using actual earnings of $10 per hour as a reference to illustrate the problems, the Uber analysis suggests the MIT study would incorrectly adjust the hourly earnings to just $4.15 per hour.

Hall carefully notes that Uber does not take issue with the paper's estimation of costs, which are "very much in line" with previous reports.

Responding to questions from Reuters, the MIT study's lead author, Stephen Zoepf, said "I can see how the question on revenue might have been interpreted differently by respondents" and promised to re-run the analysis using "Uber's more optimistic assumptions" and could have new results and a more formal response ready sometime later today.