AirBNB broke rules to get where they are (craigslist spam comes to mind)
Uber broke rules to get where they are (spamming Lyft drivers with fake requests, operating in markets where a Taxi license was required without doing the paperwork or paying the fees, picking up people in taxi-only areas (like Chicago airports) ).
The sad thing about all of this is that punishments are often so weak, the game theory optimal play IS to break the rules. If you break the rules, succeed, and get caught.. you still end up winning. If you follow the rules and fail, you are still failed.
To make game theory sense of this problem, you would need extreme punishments. Like founders in jail for 20 years or executed. The problem with this, is clearly some new businesses broke rules by accident. Opps you accidentally sold 1 insurance policy in a state you didn't have a license, let's execute you - not cool.
Funny you mention airbnb and uber, two of the worst offenders that I avoid because they won't follow the rules. You are 100% correct on the punishments not having impact for the winners, a scaling system of some sort is probably needed and smarter people than I are needed to figure it out. It's also frustrating because the end goal - in uber's case, I can't stand 99% of taxi services and they deserve to lose business even in locations the regulation isn't an outright racket - is noble.
Zenefits _knew_ they were breaking the licensing laws and had a huge number of violations. It wasn't accidental, which would a totally different discussion.
Uber broke rules to get where they are (spamming Lyft drivers with fake requests, operating in markets where a Taxi license was required without doing the paperwork or paying the fees, picking up people in taxi-only areas (like Chicago airports) ).
The sad thing about all of this is that punishments are often so weak, the game theory optimal play IS to break the rules. If you break the rules, succeed, and get caught.. you still end up winning. If you follow the rules and fail, you are still failed.
To make game theory sense of this problem, you would need extreme punishments. Like founders in jail for 20 years or executed. The problem with this, is clearly some new businesses broke rules by accident. Opps you accidentally sold 1 insurance policy in a state you didn't have a license, let's execute you - not cool.