New York Pedicab Services Blog & News

On New Year’s Eve in Midtown Manhattan, a pedicab driver charged Ken Smith, a Red Cross worker visiting from Haiti with his family, an exorbitant fare of $165 for a ride of about 15 blocks from Herald Square to Rockefeller Center. The driver illegally charged per rider and obscured the pricing on his sign, leading Smith to feel robbed by the encounter. Despite having extensive international experience, Smith and his wife, who owns a toy company in Laos, were taken aback by the scam in their own country. They paid the fare using a credit card through Square on the driver’s cracked iPhone and reported the incident to 311. New York City’s Department of Consumers Affairs, which mandates that drivers must clearly display rates and company information and prohibits per-passenger fees, has stated it will investigate the matter. Despite this negative experience, Smith expressed his continued love for New York City and his intention to return.

For more information:

https://nypost.com/2015/01/02/pedicab-takes-tourist-for-165-new-years-eve-ride/

Following a city crackdown aimed at curbing overcharging by pedicab drivers in New York, the number of licensed pedicabbies has significantly decreased, with more than a quarter opting out of renewing their licenses. Before the new regulations, which were introduced in 2013 to enforce fair pricing and improve safety, there were 1,217 licensed drivers at the start of 2014. By April, this number had dropped to 903, according to the Department of Consumer Affairs. The new rules mandate pedicab drivers to charge by the minute, display clear pricing on visible signs, and use city-approved timers, in response to incidents where tourists were grossly overcharged, sometimes up to $500 for short rides. While the reduction in pedicabs has been welcomed by many New Yorkers and residents of the Theater District and Midtown, where complaints of slow, dangerous, and obstructive pedicabs were common, there are indications that some drivers continue to find loopholes to overcharge passengers, including concealing high prices and targeting tourists at luxury hotels. Despite these challenges, the crackdown is seen as a positive step towards eliminating the most unscrupulous operators from the streets.

For more information:

https://nypost.com/2014/11/20/pedicab-licenses-down-after-city-crackdown-on-overcharging/

Consumers often prefer flat-rate pricing over metered pricing due to the psychological discomfort associated with watching costs increase with each unit of consumption, known as the “taxi-meter effect.” This preference is not solely based on the economic benefits of certainty and convenience or an overestimation of usage but stems from a desire to avoid the anxiety of incremental charges. Studies, including those by Nobel Prize-winning economist Daniel L. McFadden and research by Anja Lambrecht, have demonstrated this bias across different industries, from telecommunications to retail banking. The discomfort applies even to experiences consumers do not enjoy, indicating a deep-rooted psychological aversion to metered pricing. This insight suggests that businesses aiming for transparency and high usage might consider designing pricing schemes that offer entry-point metered rates alongside flat-rate options for more loyal customers to encourage usage without the deterrent effect of metered charges. Some businesses, like car-sharing services, might find offering a flat rate challenging but can mitigate the taxi-meter effect by reframing their pricing presentation to reduce consumer anxiety over incremental costs.

For more information:

https://slate.com/news-and-politics/2013/12/the-taxi-meter-effect-why-do-consumers-hate-paying-by-the-mile-or-the-minute-so-much.html