The Impact of Uber and Lyft on Taxi Service Quality: Evidence from New York City

Abstract

Using detailed trip-level taxi and for-hire-vehicle data and new incident-level complaints data, we study how the entry of Uber and Lyft has affected the quality of taxi services in New York City. In a panel setting with 263 NYC taxi-zones over the time period from 2014 to 2017, we find that increased competition measured by the number of daily Uber/Lyft trips in a given taxi-zone has led to more complaints regarding a variety of service quality dimensions such as unsafe driving, rude behavior and fare refusal. Our results are robust to accounting for potential simultaneity in the determination of complaints and Uber and Lyft penetration.

Keywords: ride-sharing applications, taxi, competition, service quality

JEL Classification: D01, L91, O18, R4