1/n Thread on pay models in food delivery #Doordash
2/n Based on data from Indeed it seems that drivers of (1) Doordash and (2) Grubhub have very similar pay levels 
3/n Yet we know that Doordash withholds tips, while does not
4/n This means that drivers of Doordash are less incentivised (vs GRUB drivers) to provide high quality service given that their pay is not much dependent on the level of tips the customer pays
5/n This also means that drivers are incentivised to maximise their tips by doing only deliveries with the highest chance of getting tips AND avoiding orders without tips/low value orders.
6/n Another difference is that in Doordash model driver earnings should be more smooth, as drivers in most cases get their "guaranteed amount" which is around $10 per order.
7/n In GRUB model driver earnings should be more lumpy as you can get a $3 order with no tips and $20 order with $10 tips.
8/n But the key question here is what's the point for Doordash to withhold tips given that eventually their drivers have the same pay as drivers of ?
9/n My take is Doordash model helps them subsidize low value orders. This is important given that food delivery companies are valued based on GFS.
10/n This is an example of how both models might work in real life
11/n Pay rate distribution for Doordash is more concentrated as compared to
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