Market‐expanding or Market‐stealing? Competition with network effects in bike‐sharing

Guangyu Cao, Ginger Zhe Jin, Xi Weng and Li-An Zhou

RAND Journal of Economics, 2021, vol. 52, issue 4, 778-814

Abstract: Using staggered entry of two dockless bike‐sharing firms, we study whether the entrant expands or steals the market from the incumbent in 59 cities. Compared with 23 cities without entry, the entry helps the incumbent to serve more trips, make more bike investment, achieve higher revenue per trip, improve bike utilization, and form a wider and more dispersed network. The market‐expanding effect on new users dominates a significant market‐stealing effect on old users. These findings, plus a theory that highlights consumer search and network effects, suggest that a market with positive network effects and multihoming users is not necessarily winner‐takes‐all.

Date: 2021
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (7)

Downloads: (external link)
https://doi.org/10.1111/1756-2171.12391

Related works:
Working Paper: Market Expanding or Market Stealing? Competition with Network Effects in BikeSharing (2018)
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:bla:randje:v:52:y:2021:i:4:p:778-814

Ordering information: This journal article can be ordered from
http://www.blackwell ... al.asp?ref=0741-6261

Access Statistics for this article

RAND Journal of Economics is currently edited by James Hosek

More articles in RAND Journal of Economics from RAND Corporation Contact information at EDIRC.
Bibliographic data for series maintained by Wiley Content Delivery ().