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Theory and Decision

, Volume 85, Issue 3–4, pp 407–433 | Cite as

A network ridesharing experiment with sequential choice of transportation mode

  • Vincent Mak
  • Darryl A. Seale
  • Eyran J. Gisches
  • Amnon Rapoport
  • Meng Cheng
  • Myounghee Moon
  • Rui Yang
Article
  • 153 Downloads

Abstract

Within the last decade, there has been a dramatic bloom in ridesharing businesses along with the emergence of new enabling technologies. A central issue in ridesharing, which is also important in the general domain of cost-sharing in economics and computer science, is that the sharing of cost implies positive externalities and hence coordination problems for the network users. We investigate these problems experimentally in the present study. In particular, we focus on how sequential observability of transportation mode choices can be a powerful facilitator of coordination in ridesharing. Our study abstracts the essential issues of coordination in ridesharing into a directed network game with experimentally testable predictions. In line with the theoretical analysis, our experimental evidence shows that even a limited extent of sequential choice observability might lead to efficient coordination. However, convergence to efficiency is slower with more limited observability, resulting in a significant increase in travel cost.

Keywords

Ridesharing Traffic networks Sequential choice Experiment 

Notes

Acknowledgements

This research was supported by NSF Grant SES-1418923 awarded to the University of Nevada, Las Vegas and University of Arizona.

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Copyright information

© Springer Science+Business Media, LLC, part of Springer Nature 2018

Authors and Affiliations

  • Vincent Mak
    • 1
  • Darryl A. Seale
    • 2
  • Eyran J. Gisches
    • 3
  • Amnon Rapoport
    • 3
  • Meng Cheng
    • 4
  • Myounghee Moon
    • 4
  • Rui Yang
    • 4
  1. 1.Cambridge Judge Business SchoolUniversity of CambridgeCambridgeUK
  2. 2.Lee Business SchoolUniversity of Nevada, Las VegasLas VegasUSA
  3. 3.Eller College of ManagementUniversity of ArizonaTucsonUSA
  4. 4.School of BusinessUniversity of CaliforniaRiversideUSA

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