Toward Inclusive Mobility: Ridesharing Mitigates Geographical Disparity in Transportation

39 Pages Posted: 7 Jul 2017 Last revised: 11 Jan 2019

See all articles by Chungsang Lam

Chungsang Lam

Clemson University - John E. Walker Department of Economics

Meng Liu

Massachusetts Institute of Technology (MIT) - Sloan School of Management; Washington University in St. Louis

Date Written: Jan 9, 2019

Abstract

Mobility is found to causally affect individuals' economic outcomes, yet as of today U.S. metropolitan neighborhoods still face significantly unequal access to public transit and taxis. We study the effect of ridesharing on geographical disparity in transportation by leveraging detailed ridership, pricing, and wait time data for New York City taxis, Uber, Lyft, and public transit. First, we use data from actual trips to show that ridesharing coverage is more likely to dominate that of taxis in neighborhoods that are less served by public transit. We then uncover the reason behind the low taxi coverage in low accessibility neighborhoods --- taxi drivers' lack of information about real-time demand. Thus, the advanced driver-passenger matching enabled by ridesharing companies fills the gap and consequently wins the market in these areas. Finally, we confirm the role of ridesharing through a consumer choice study, which reveals disproportionate per-dollar consumer surplus of ridesharing service in low accessibility neighborhoods. Our findings suggest that technologies can play a key role in mitigating long-standing geographical disparity in transportation.

Keywords: Ridesharing, tech-aided matching, geographical disparity, inclusive mobility

JEL Classification: L10, L91, D40, D60, O33

Suggested Citation

Lam, Chungsang and Liu, Meng, Toward Inclusive Mobility: Ridesharing Mitigates Geographical Disparity in Transportation (Jan 9, 2019). Available at SSRN: https://ssrn.com/abstract=2997190 or http://dx.doi.org/10.2139/ssrn.2997190

Chungsang Lam

Clemson University - John E. Walker Department of Economics ( email )

Clemson, SC 29634
United States

Meng Liu (Contact Author)

Massachusetts Institute of Technology (MIT) - Sloan School of Management ( email )

Cambridge, MA 02139
United States

Washington University in St. Louis ( email )

One Brookings Drive
Campus Box 1208
Saint Louis, MO MO 63130-4899
United States

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