Dr Eric Crampton: Court ruling on Uber drivers undermines the ride-share model

There are a couple of ways to solve a problem like the Court of Appeal’s ruling that four Uber drivers are employees rather than contractors.

Either of them would work. At least one of them is needed. And one of them might be more likely to survive a change of government.

But first, the problem.

Mike's Minute: Uber decision could have a chilling effect

The New Zealand Uber drivers have won their case in the Court of Appeal. It agrees with the Employment Court that Uber drivers should be employees, not contractors.

Other courts in other countries have broadly come down on the same lines.

But not in California. The other day, the court there agreed with the people. And the people had voted in a proposition that drivers should be contractors because that’s what drivers signed up to.

So you can ask, is democracy right? Or is a court right?