In a recent study, researchers from Harvard and Johns Hopkins business schools examined over 2,200 ride requests in New York City to determine whether Uber or Lyft consistently offered lower fares.
They analyzed 2,238 individual rides, comparing the quoted price that each app displayed to riders at the time the ride was requested.
The goal was to see if one platform was systematically cheaper across a range of trip lengths and distances.
The researchers found a recurring price gap between the two services, but the data did not favor either side.
As the authors noted in their paper, ”neither rideshare app is consistently more expensive than the other.”
In some trips, Uber’s quoted fare exceeded Lyft’s, and in others the reverse was true.
The average difference was 14 percent, which translates to roughly $3.50 on the routes studied.
This 14 percent gap held true for both short and longer rides.
The study also examined the relationship between price and wait time.
The researchers discovered that a higher quoted fare did not guarantee a quicker pickup, and a lower fare did not force riders to wait longer.
In other words, the price difference was largely unrelated to the speed of service.
To confirm the findings, two journalists at the Washington Post conducted a parallel experiment in San Francisco.
They requested rides from both Uber and Lyft and recorded the quoted fares.
Their results mirrored the academic study: the two platforms alternated as the cheaper option, with no clear winner over time.
Given these results, the paper’s authors and the journalists arrived at the same practical advice: ”Check both apps.”
The recommendation is simple but often overlooked.
Most riders do not compare the two platforms before accepting a ride.
Only 16 percent of riders, according to the study, actually compare both apps before booking.
That leaves 84 percent of riders potentially paying more than they need to.
For users who have both apps installed and are not loyal to either brand, the data suggest that a quick price comparison can save a few dollars on most trips.
The financial impact of this behavior is significant.
In New York City alone, the overpayment by riders is estimated to cost users $300 million each year.
That figure reflects the cumulative effect of riders consistently choosing the higher fare without realizing it.
The study underscores the importance of transparency in rideshare pricing.
Even though the two platforms use similar surge pricing algorithms and base rates, the variation in quoted fares can be substantial.
Riders who take the time to glance at both apps can avoid unnecessary costs.
The researchers’ findings also highlight a broader lesson about consumer choice in the gig economy.
When two competitors offer similar services, price can fluctuate widely, and consumers may be unaware of the variations.
Simple tools, such as side-by-side fare comparison, can level the playing field.
In conclusion, the research demonstrates that there is no single rideshare app that is always cheaper.
The price difference averages 14 percent, but it can swing either way on any given trip.
Riders who check both Uber and Lyft before booking are more likely to get the best price, potentially saving money and reducing the $300 million annual overpayment in New York City.
Key Takeaways
- Uber and Lyft alternate as the cheaper option, with an average price gap of 14 percent (~$3.50).
- Pay-more does not mean a faster ride, and pay-less does not mean a longer wait.
- Only 16 percent of riders compare both apps, leaving 84 percent at risk of overpaying.
The study’s clear message is simple: before you hit ”accept”, open both apps and choose the lower fare. It’s a small extra step that can add up to significant savings over time.
