The Economic Importance of the Scooter

Mike Dershowitz
Fair Trade Entrepreneurship
6 min readJul 26, 2018


The economics of riding a scooter in the developing world.

American culture has long mythologized the open road, and the individual freedom that a vehicle brings to a person. In the post-war era in America, when incomes were rising and a new middle-class was being built, the car or motorcycle was simply another word for freedom within the American mind-set. You weren’t free unless you could get around on your own time, at your own pace, and in your own vehicle.

Whether it was the car, motorcycle or SUV, the internal combustion engine, relying on one of the most powerful fuel sources on the planet (petroleum), was one of the greatest economic growth agents of the 20th century. I could go on and on about the economic and military importance of oil, but other authors (Daniel Yurgin’s “The Prize” comes to mind) have done it better than I could have.

Think about the SUV for a minute. The sport utility vehicle was introduced in 1984. Its raison d’être made sense when looked through an economic perspective. As there was broad-based income increases in the American economy, people needed not just a way to go places, but now they needed and wanted a vehicle that could help them do things. Thus, a hybrid vehicle (much like the minivan) was born — you could both go places and do things.

Freedom is a universal human desire, and people in the developing world are no different. In the developing world, freedom is harder to achieve, and is less secure, but the desire for it is no less strong than anywhere else in the world. Homo sapiens as organisms, like many organisms on earth, including cockroaches, want to go where they want to go. The difference is that cockroaches can only contemplate going to their next meal; whereas, humans understand that they live on a planet and can get virtually anywhere on it if they have the right vehicle.

Which is why the scooter is so important in the developing world. Why? It’s important for two key reasons. First, it enables riders to get to work outside of public transportation. Second, it inexpensively conveys riders to where they want to go, not just where they should go.

Getting to work on my own time

There are stories from within our own delivery centers of how some of our agents spend 1.5 hours each way to get to work on public transportation. In this time, they’re traveling only 5 miles (and we’re NOT in Manila either — so it’s not all traffic). Public transportation is necessary but incredibly time-inefficient for our Agents. So, not only do our Agents live with the burdens of being at the base of the pyramid in their societies, they do it while wasting a lot of time on the jeepney and trike.

The modified jeepney (left) and tricycle (right) are common modes of public transportation in the Philippines. Photo by Mekong via Pixabay.

The scooter is the most economically efficient internal combustion vehicle ever invented, much more so than Ford’s Model T. As billions of people in the developing world enter the middle class, the scooter provides them with a permanent means of transportation they can afford, not just to own, but also to maintain. The average new scooter in the Philippines only costs around 900 dollars.

What’s great about the scooter is that it’s a cunning example of a hyper-efficient economic tool. Not only is it inexpensive to own (with the basic scooter equaling just 2 months the average middle-class salary — at least here in the Philippines, whereas the average car in America is 3–4 times the average month’s salary). The scooter sips gas, can be modified to convey people and goods, and most importantly, can help you weave through traffic to get to work on time. We’ve all seen those pictures of a Model T propped up on blocks, with the rear tires removed, and in their place, a power belt attached to some kind of farm equipment. Not just conveyance, economic tool.

What you’re about to read may seem strange, but I think the scooter is as important a technology to the developing world as fiber-optic technology, the micro-processor, inexpensive containerized shipping, and the ability to inexpensively purify water. These technologies combined are and have continued to integrate the developing world into our planetary economy so that both the developed and developing world can continue to expand their trade relationships and benefit from the win-win that is international trade.

In the BPO/Outsourcing industry, we see how the scooter can improve conditions for our Agents. At the heart of the beneficial trade relationships between the developing and developed world is inexpensive labor — long derided by pundits and politicians in the US, but essential to the continued development of the world economy.

But the trick is this: all of that labor still has to get to work every day, and they spend a lot of time doing it. Problems with transportation are a major drive of absenteeism rates in call centers. They can get to work better, faster, cheaper, and more safely, if they do it on a scooter.

Where I want to go

Getting to work on a scooter vs. the jeepney is a key lever in the lives of the average call center Agent. One of the reasons why I love economics is because every once and a while you find something that is already widespread, that, if applied to a new context, can bring so much good to the way economic actors are living their lives.

The scooter is just such a device for call center Agents.

The scooter is an incredibly powerful change agent in our call center Agents’ lives for a number of reasons, but these are the biggies that make it obvious that all agents should own one:

  1. Stress Reducing — Agents now have only themselves, and the good functioning of their scooter, to worry about in getting to work. Given the harsh sanctions for lateness in most call centers, eliminating the complexities of dealing with public transportation, and knowing you can reliably get to work is a huge relief
  2. Recapture commuting time — This one is obvious. Most Agents’ commute times go down by 70% when they own a scooter;
  3. A sign of personal economic progress — this one cannot be overlooked. The scooter is an unmistakable sign of economic progress — that you’re getting somewhere in life. The social benefit to the owner is significant.

But most importantly, the riders/owners of the scooter are much happier, and can work better. Not only can they get to work, but they can also be conveyed to places they want to go, not merely places they need to go. They become, think of themselves as, freer people.

Conclusion: The new road to freedom

What will they do with that freedom? Mohammed Yunas has proven that you don’t need to teach the poor how to improve their lives — just remove the barriers that prevent them from doing so themselves. To BPO workers, the scooter is that thing — and most of them will use it to improve their lives.

The largest BPO companies in the world in India and the Philippines constantly try to redact their people to numbers, endless numbers. But they always overlook one fact: the numbers are only good if the people creating those numbers are happy and fulfilled in their lives.

The humble scooter is not just a scooter. It’s a freedom creation tool, one that can transform lives. In the coming weeks, Rethink Staffing will be taking a major step forward in the way we build our culture and economic system, highly integrating the scooter into what we do. Stay tuned.



Mike Dershowitz
Fair Trade Entrepreneurship

Mike is the CEO of Fair Trade Outsourcing, a people-first BPO company that uses the power of the free market to fight poverty and promote moral leadership.