Market Expanding or Market Stealing? Competition with Network Effects in BikeSharing

Cao, Guangyu; Jin, Ginger Zhe; Wang, Xi; Zhou, Li-An

doi:10.3386/w24938

Cited by 11 publications

(5 citation statements)

References 8 publications

Supporting

Mentioning

Contrasting

Order By: Relevance

“…In addition, a series of papers study different aspects of efficiency in urban transportation; for instance, Shapiro (2018) and Liu et al (2019) explore the welfare improvements from different centralizing formats; Ghili and Kumar (2020) investigate demand and supply imbalances in ride-sharing platforms; Ostrovsky and Schwarz (2018) focus on carpooling and self-driving cars; Kreindler (2020) studies optimal congestion pricing; Cao et al (2018) explore competition in bike-sharing platforms; while several papers study platform pricing (e.g. Bian, 2020, Ma et al, 2018, Castillo, 2019.…”

Section: Related Literaturementioning

confidence: 99%

Search Frictions and Efficiency in Decentralized Transport Markets

Brancaccio

Kalouptsidi

Papageorgiou

et al. 2023

The Quarterly Journal of Economics

View full text Add to dashboard Cite

We explore efficiency and optimal policy in decentralized transport markets, such as taxis, trucks, and bulk shipping. We show that in these markets, search frictions distort the transportation network and the dynamic allocation of carriers over space. We derive explicit and intuitive conditions for efficiency, and show how they translate into efficient pricing rules, or optimal taxes and subsidies for the planner who cannot set prices directly. The results imply that destination-based pricing is essential to attain efficiency. Then, using data from dry bulk shipping, we demonstrate that search frictions lead to a sizeable social loss and substantial misallocation of ships over space. Optimal policy can eliminate about half of the welfare loss. Can a centralizing platform, often arising as a market-based solution to search frictions, do better? Interestingly, the answer is no; although the platform eradicates frictions, it exerts market power thus eroding the welfare gains. Finally, we use two recent interventions in the industry (China’s Belt and Road Initiative and the environmental initiative IMO 2020) to demonstrate that taking into account the efficiency properties of transport markets is germane to any proposed policy.

show abstract

Section: Related Literaturementioning

confidence: 99%

Search Frictions and Efficiency in Decentralized Transport Markets

Brancaccio

Kalouptsidi

Papageorgiou

et al. 2023

The Quarterly Journal of Economics

View full text Add to dashboard Cite

show abstract

“…Similarly, Reshef (2019) documents that the entry of new restaurants on a food delivery platform increases the performance of high-quality incumbent businesses, because consumers have more options to choose from on the platform, while hurting low-quality incumbent businesses. Furthermore, Cao et al (2018) show that entrants expand market demand for incumbents due to the network effect in the bike-sharing industry in China. Shen and Xiao (2014) and Yang (2019) study the learning effect of observing competitors' entry in the fast food industry.…”

Section: Related Literature and Contributionmentioning

confidence: 99%

Targeted incentives, broad impacts: Evidence from an E-commerce platform

2023

View full text Add to dashboard Cite

Digital platforms sometimes offer incentives to a subset of sellers to nudge behavior, possibly affecting the behavior of all sellers in the equilibrium. In this paper, we study a policy change on a large e-commerce platform that offers financial incentives only to platform-certified sellers when they provide fast handling and generous return policies on their listings. We find that both targeted and non-targeted sellers become more likely to adopt the promoted behavior after the policy change. Exploiting a large number of markets on the platform, we find that in markets with a larger proportion of the targeted population-hence more affected by the policy change-nontargeted sellers are more likely to adopt the promoted behavior and experience a larger increase in sales and equilibrium prices. This finding is consistent with our key insight that a targeted incentive may increase demand for non-targeted sellers when both platform certificates and the promoted behaviors are quality signals. Our results have managerial implications for digital platforms that use targeted incentives.

show abstract

“…Perceived entertainment in bike sharing is defined as the pleasure and relaxation enjoyed by users while using bike-sharing services, not just solving travel difficulties ( Venkatesh et al, 2012 ). To expand new users and keep regular users operators launch creative activities to grow entertainment, such as “Free Riding Day” activities, which enrich users’ consumption experience and add entertainment value ( Cao et al, 2018 ). According to the intrinsic motivation theory, perceived entertainment is considered as an internal motive for evoking a behavior ( Davis et al, 1992 ; Lee et al, 2005 ).…”

Section: Overview Of the Researchmentioning

confidence: 99%

Increasing Bike-Sharing Users’ Willingness to Pay — A Study of China Based on Perceived Value Theory and Structural Equation Model

et al. 2022

View full text Add to dashboard Cite

Bike sharing, as an innovative travel mode featured by mobile internet and sharing, offers a new transport mode for short trips and has a huge positive impact on urban transportation and environmental protection. However, bike-sharing operators face some operational challenges, especially in sustainable development and profitability. Studies show that the customers’ willingness to pay is a key factor affecting bike-sharing companies’ operating conditions. Based on the theories of perceived value, this study conducts an empirical analysis of factors that affect bike-sharing users’ willingness to pay for bike-sharing through measurement scales, user surveys, and structural equation models. We designed a five-point Likert-type scale containing 11 latent variables affecting willingness to pay and a total of 34 measurement items. We investigate bike-sharing users in China’s first and second-tier cities, with a total of 502 participants. The results show that perceived value, payment awareness, trust, and environmental awareness constitute key factors that directly affect bike-sharing users’ willingness to pay. And perceived usefulness, perceived ease-of-use, perceived cost, and perceived risk indirectly affect bike-sharing users’ willingness to pay. However, we found no significant effects of perceived entertainment on perceived value or word of mouth on willingness to pay. Our results are expected to provide theoretical and practical implications for bike-sharing programs.

show abstract

Market Expanding or Market Stealing? Competition with Network Effects in BikeSharing

Cited by 11 publications

References 8 publications

Search Frictions and Efficiency in Decentralized Transport Markets

Search Frictions and Efficiency in Decentralized Transport Markets

Targeted incentives, broad impacts: Evidence from an E-commerce platform

Increasing Bike-Sharing Users’ Willingness to Pay — A Study of China Based on Perceived Value Theory and Structural Equation Model

Contact Info

Product

Resources

About