Why the downvotes? While you may argue that most countries have only a semblance of a free market, Uber does indeed have competitors and is operating under market pressure.
Riders don't set the rates, no... but I'm not sure what that has to do with a free market.
They're not saying that Uber doesn't operate in a free market. They're saying that the competition between drivers within Uber for rides whose prices are fixed by Uber does not constitute a free market.
I suppose it makes sense when applied just to Uber, but it seems misleading. Actors in a free market system will have different models that in isolation would be not so free. I thought free market deals with aggregates.
Since Uber sets prices for a large portion of the market they operate in they have monopoly power and it's therefore not a free market. Uber's at 46% market share in major U.S. markets[0], since taxi's are regulated locally and Uber is setting prices for almost half the market nationally Uber is arguably the #1 regulatory power in the U.S. personal transportation sector.
It's still early though, right? I mean, they might have some dominance now (I wouldn't call 46% in major markets a monopoly), but let's see how things shake out in a few years.
> Uber is arguably the #1 regulatory power in the U.S. personal transportation sector.
I would reserve the phrase "regulatory power" to government. I think you're using it here for the hyperbolic value.
Given Uber's recent $50bn valuation I'd say "the market" believes they'll keep their market power and resulting profits for some time into the future. (46% definitely means monopoly power but it doesn't mean monopoly.)
I am being snarky, but the libertarian poster-child is shielding 46% of the national market from competition (drivers can't compete with eachother) and that's pretty ironic.
> A free market is a market system in which the prices for goods and services are set freely by consent between vendors and consumers, in which the laws and forces of supply and demand are free from any intervention by a government, price-setting monopoly, or other authority.
Uber is a price-setting monopoly within the Uber market. Uber is the sole authority in the prices that consumers pay and that drivers receive.
The Uber marketplace is NOT a free market. QED. Its rent-seeking behavior on behalf of the owners.
I suppose if you consider Uber to exist in a vacuum with no other competitors or outside forces. But it doesn't, so I'm not sure how your usage of free market holds up.
Sure, but Uber previously styled themselves as just a middleman between drivers and passengers - the facilitators of a market, not a force in the market of their own.
Consider a counterexample - eBay is clearly a market. Independent buyers and sellers agree to transactions, on their own terms. eBay competes for the attention of both buyers and sellers, in terms of service and fees, not on the prices of the actual goods in the market.
If the competition that's happening in the transportation market is between Uber and Lyft, and that competition is on the price of rides and quality of rides, then Uber isn't a market, it's a vendor in a market - and thus the drivers aren't vendors within Uber's market, they're just employees of Uber.
Riders don't set the rates, no... but I'm not sure what that has to do with a free market.