Technological Platforms and Self-regulation: the Case of Safe-boda in Uganda

Abstract: Industry actors frequently seek to engage in self-regulation to enforce standards among industry participants. Yet such efforts at private regulation typically suffer from classic problems related to free riding and the tragedy of the commons. This paper proposes that technological platforms can serve a private-regulatory function when they 1) provide tools for monitoring or reporting malfeasance and 2) credibly restrict access to the platform, thus sanctioning malfeasants. The paper illustrates these points with a case study of Safe-Boda, an Uber-like motorcycle taxi firm in Uganda. Motorcycle taxis, known as boda-bodas, are notoriously dangerous for drivers, passengers, and pedestrians alike. Efforts at state regulation and industry self-regulation both failed in the mid-2000s and early 2010s. In contrast, the introduction of a ride-hailing technology platform that met both of the above conditions has succeeded at reducing unsafe driving, and also at matching riders with lower tolerance for unsafe rides with drivers who engage in safer practices.