Beyond Taxis: Reference-Dependence in Rideshare Drivers' Labor Supply

50 Pages Posted: 16 Sep 2022 Last revised: 22 Dec 2022

See all articles by Anthony Kukavica

Anthony Kukavica

Stanford Graduate School of Business

Sean McKenna

California Institute of Technology (Caltech)

Matthew Shum

California Institute of Technology (Caltech)

M. Keith Chen

University of California, Los Angeles (UCLA) - Anderson School of Management

Colin Camerer

California Institute of Technology (Caltech) - Division of the Humanities and Social Sciences

Date Written: August 31, 2022

Abstract

Self-employed workers provide useful evidence about the nature of flexible labor supply and possible reference-dependence. Many previous studies analyzed taxi cabdrivers. Newer rideshare platforms provide greater work hour flexibility and use surge pricing, making future marginal wages salient. We estimate stopping probability and structural labor supply models, previously applied only in the fixed-shift taxicab setting, to rideshare work. Stopping probability does increase significantly upon reaching an apparent income target. However, the degree of estimated loss aversion is much lower than in fixed-shift taxi data and does not change with experience as in taxi analyses.

JEL Classification: D01, D03, J22

Suggested Citation

Kukavica, Anthony and McKenna, Sean and Shum, Matthew and Chen, Keith and Camerer, Colin F., Beyond Taxis: Reference-Dependence in Rideshare Drivers' Labor Supply (August 31, 2022). Available at SSRN: https://ssrn.com/abstract=4205411 or http://dx.doi.org/10.2139/ssrn.4205411

Anthony Kukavica

Stanford Graduate School of Business ( email )

655 Knight Way
Stanford, CA 94305
United States

Sean McKenna

California Institute of Technology (Caltech) ( email )

Pasadena, CA 91125
United States

Matthew Shum

California Institute of Technology (Caltech) ( email )

Pasadena, CA 91125
United States

Keith Chen

University of California, Los Angeles (UCLA) - Anderson School of Management ( email )

110 Westwood Plaza
Los Angeles, CA 90095-1481
United States

HOME PAGE: http://www.anderson.ucla.edu/faculty/keith.chen/index.html

Colin F. Camerer (Contact Author)

California Institute of Technology (Caltech) - Division of the Humanities and Social Sciences ( email )

1200 East California Blvd.
Pasadena, CA 91125
United States
626-395-4054 (Phone)
626-432-1726 (Fax)

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