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The Gender Gap at Uber
We find that men earn roughly 7% more per hour than women on average. We can explain the entire gap with three factors.
First, through the logic of compensating differentials, hourly earnings on Uber vary predictably by location and time of week, and men tend to drive in more lucrative locations.
The second factor is work experience. A driver with more than 2,500 lifetime trips completed earns 14% more per hour than a driver who has completed fewer than 100 trips in her time on the platform.
Male drivers accumulate more experience than women by driving more each week and being less likely to stop driving with Uber.
Third, the residual gender earnings gap that persists after controlling for these two factors can be explained by a single variable: average driving speed.
The loss of per-minute pay when driving quickly is outweighed by the value of completing a trip quickly to start the next trip sooner and accumulate more per-mile pay (across all trips).
We show that men’s higher driving speed is due to preference, as drivers appear insensitive to the incentive to drive faster.
See also the Simpson Paradox at UC Berkeley.
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