THESIS
2003
vi, 118 leaves : ill. ; 30 cm
Abstract
Almost all taxi markets over the world are under heavy regulations from local governments, such as entry restriction and price control. Economists have examined the economic consequences of such regulation extensively and find that the intertwined relationship between customer demand and service quality, the waiting time, makes the selection of optimal regulation strategies far from straightforward. As taxi service becomes an important and indivisible part of the urban public transport in most large cities, it is significant and urgent to study the optimal regulation by exploring the nature of the taxi market equilibrium. In this dissertation, we focus on modeling and analyzing the taxi market equilibrium mechanism under more realistic market settings....[
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Almost all taxi markets over the world are under heavy regulations from local governments, such as entry restriction and price control. Economists have examined the economic consequences of such regulation extensively and find that the intertwined relationship between customer demand and service quality, the waiting time, makes the selection of optimal regulation strategies far from straightforward. As taxi service becomes an important and indivisible part of the urban public transport in most large cities, it is significant and urgent to study the optimal regulation by exploring the nature of the taxi market equilibrium. In this dissertation, we focus on modeling and analyzing the taxi market equilibrium mechanism under more realistic market settings.
First of all, the current research is reviewed with an analytical example in chapter 1. In this chapter, a static model is investigated under various market settings to gain us a general idea about the taxi market equilibrium mechanism. Without exception, all traffic is subjected to the impacts of congestion. Occupied taxis and vacant taxis together with normal vehicles traveling on the network surely bring and suffer from the congestion. The congestion externalities are incorporated together with a realistic distance-based and delay-based taxi fare structure assumed in our study. It is concluded that the congestion surely deteriorates both society and taxi firms' benefits. With the presence of congestion externalities, the first-best solution in fact can lie in the non-negative profit region, while the monopoly solution would increase the firm's market power by setting the price more than the marginal cost, and the second-best solution is found to be a subtle balance of the benefits of both society and taxi firms.
A remarkable characteristic of taxi service in most metropolitans is the hourly variation of customer demand and taxi service intensity throughout the whole day. With such a market setting, individual taxi drivers or firms can freely choose their working schedules in response to market profitability and operating cost as well as opportunity cost of being in service in different time of the day. An aggregate multi-period taxi service model with endogenous service intensity is hence presented. The whole day service period is divided into a number of sub-periods, during each sub-period, taxi supply and customer demand characteristics are assumed to be uniform. Customer demand is period specific and described as a function of waiting time and taxi fare. Taxi operating cost for each work shift consists of two components: one component being a function of total service time and the other component being period dependent. Each taxi driver can work for one or more shifts each day and freely choose starting and ending time of each shift. Equilibrium of taxi services is obtained when taxi drivers cannot increase their individual profits by changing their individual working schedules. A novel clock network representation is proposed to characterize the multi-period taxi service equilibrium problem. The problem of interest is formulated as a network equilibrium model with path-specific cost and arc capacity constraint. Finally, all analysis and relevant algorithms proposed in this thesis are illustrated by corresponding numerical examples.
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