Impacts of congestion pricing on ride-hailing ridership: Evidence from Chicago

Yunhan Zheng, Patrick Meredith-Karam, Anson Stewart, Hui Kong and Jinhua Zhao

Transportation Research Part A: Policy and Practice, 2023, vol. 170, issue C

Abstract: To combat congestion, promote sustainable forms of transportation, and support the public transit system, Chicago introduced a congestion pricing policy targeting transportation network company (TNC) services on January 6, 2020. This policy aimed to discourage single-occupant and peak-period TNC travel, particularly in high-congestion areas. Using TNC trip record data collected from the Chicago Data Portal, we quantify the impacts of the congestion pricing policy on TNC ridership in Chicago, differentiating between shared and single-occupant trips. Employing a Difference-in-Differences identification strategy, we find that the implementation of the congestion pricing policy led to an increase in shared TNC trip counts and a much larger decrease in single-occupant trip counts. Overall, the policy implementation is associated with a 7.1% reduction of total TNC pickup trips, a 16.4% increase of shared TNC pickup trips and a 11% reduction of single TNC pickup trips. Given the estimated policy effects, we find that the price elasticity of the TNC trip volume in the downtown areas is roughly −0.48. In terms of spatial variation, we find that the lost TNC trips were mainly trips that began and ended in the central business district. The south side of Chicago, which has a high proportion of African-American and low-income residents, shows evidence of single trip reduction for trips that began or ended in the downtown areas due to the policy implementation, but the policy did not seem to incentivize pooling to or from the downtown areas as effectively in the south side as in other regions of Chicago. Regarding the time-of-day variation, we find that the policy is more effective in encouraging trip sharing for off-peak travels than for peak-time travels. Our research provides local planners and policymakers with valuable insights into the impacts of the congestion pricing policy. The method and findings of this research can also be used for other cities that are considering adopting congestion pricing policies on TNCs in the future.

Keywords: Transportation network company (TNC); Ride-hailing; Congestion pricing; Regulatory policy; Pooling; Difference-in-differences; Natural experiment (search for similar items in EconPapers)
Date: 2023
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Citations: View citations in EconPapers (3)

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DOI: 10.1016/j.tra.2023.103639

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