Can two competing on-demand service platforms be profitable?

Jiaru Bai and Christopher S. Tang

International Journal of Production Economics, 2022, vol. 250, issue C

Abstract: Can two competing on-demand service platforms be profitable in equilibrium? This question is well-studied for firms competing purely on price in a single-sided market, but it is not well-understood for competing service platforms that use price to influence passenger demand and wage to influence driver participation in a “two-sided” market. To fill this research gap, we analyze the equilibrium structure of different variants of a 2-stage non-cooperative game in which both platforms use lower prices and waiting time to compete for more customers and higher wages and utilization to entice more providers to participate.

Keywords: On-demand economy; Non-cooperative game; Increasing return; Network externality; Two-sided markets; Platform competition (search for similar items in EconPapers)
Date: 2022
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (4)

Downloads: (external link)
http://www.sciencedirect.com/science/article/pii/S0925527322002547
Full text for ScienceDirect subscribers only

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:eee:proeco:v:250:y:2022:i:c:s0925527322002547

DOI: 10.1016/j.ijpe.2022.108672

Access Statistics for this article

International Journal of Production Economics is currently edited by Stefan Minner

More articles in International Journal of Production Economics from Elsevier
Bibliographic data for series maintained by Catherine Liu ().