Uber’s early entry decisions in the US

James L. Swofford

Applied Economics, 2020, vol. 52, issue 25, 2723-2729

Abstract: Early entry decisions of the firm are crucial to its success. Ride-sharing businesses developed due to technology and government regulation. With the advent of the ride-sharing technology, firms like Uber, Lyft, etc. were faced with the decision of which markets to enter first. For this paper, a model is developed of a profit-maximizing firm constrained from entering all markets simultaneously. The entry decision of Uber into the 50 most populous US metropolitan statistical areas (MSA) is examined. The results suggest Uber’s entry decision was constrained and affected by both revenue potential and regulation in the local taxi industry.

Date: 2020
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DOI: 10.1080/00036846.2019.1694633

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