Publication Type

Journal Article

Version

acceptedVersion

Publication Date

5-2022

Abstract

Recently, some third-party integrators attempt to integrate the ride services offered by multiple independent ride-sourcing platforms. Accordingly, passengers can request ride through the integrators and receive ride service from any one of the ride-sourcing platforms. This novel business model, termed as third-party platform-integration in this work, has potentials to alleviate market fragmentation cost resulting from demand splitting among multiple platforms. Although most existing studies focus on operation strategies for one single monopolist platform, much less is known about the competition and platform-integration and their implications on operation strategy and system efficiency. In this work, we propose mathematical models to describe the ride-sourcing market with multiple competing platforms and compare system performance measures between two market scenarios (i.e., with and without platform-integration) at Nash equilibrium and social optimum. We find that platform-integration can increase the total realized demand and social welfare at Nash equilibrium and social optimum, but may not necessarily generate a greater profit when the vehicle supply is sufficiently large, and/or the market is considerably fragmented. We show that the market with platform-integration generally achieves greater social welfare due to two reasons. First, platform-integration can generate a thicker market and reduce matching frictions; second, multiple ride-sourcing platforms are competing for passengers by setting lower trip fares independently.

Keywords

Ride-sourcing, competition, platform-integration

Discipline

Numerical Analysis and Scientific Computing | Operations Research, Systems Engineering and Industrial Engineering | Transportation

Research Areas

Intelligent Systems and Optimization

Publication

Transportation Research Part B: Methodological

Volume

159

First Page

76

Last Page

103

ISSN

0191-2615

Identifier

10.1016/j.trb.2021.08.002

Publisher

Elsevier

Copyright Owner and License

Authors

Additional URL

https://doi.org/10.1016/j.trb.2021.08.002

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