Abstract | ||
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Regulating on-demand ride-hailing services (e.g., Uber and DiDi) requires a balance of multiple competing objectives: encouraging innovative business models (e.g., DiDi), sustaining traditional industries (e.g., taxi), creating new jobs, and reducing traffic congestion. This study is motivated by a regulatory policy implemented by the Chinese government in 2017 and a similar policy approved by the New York City Council in 2018 that regulate the "maximum" number of registered Uber/DiDi drivers. We examine the impact of these policies on the welfare of different stakeholders (i.e., consumers, taxi drivers, on-demand ride service company, and independent drivers). By analyzing a two-period dynamic game that involves these stakeholders, we find that, without government intervention, the on-demand ride service platform can drive the traditional taxi industry out of the market under certain conditions. Relative to no regulations and a complete ban policy, a carefully designed regulatory policy can strike a better balance of multiple competing objectives. Finally, if a government can reform the taxi industry by adjusting the taxi fare, then lowering the taxi fare instead of imposing a strict policy toward on-demand ride services can improve the total social welfare. |
Year | DOI | Venue |
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2020 | 10.1287/mnsc.2019.3351 | MANAGEMENT SCIENCE |
Keywords | DocType | Volume |
on-demand ride services,public policy,consumer welfare,social welfare | Journal | 66 |
Issue | ISSN | Citations |
7 | 0025-1909 | 1 |
PageRank | References | Authors |
0.37 | 0 | 4 |
Name | Order | Citations | PageRank |
---|---|---|---|
Jiayi Joey Yu | 1 | 1 | 0.37 |
Christopher S. Tang | 2 | 859 | 103.89 |
Zuo-Jun Max Shen | 3 | 479 | 34.75 |
Chen X | 4 | 114 | 14.01 |