Government regulations for ride-sourcing services as substitute or complement to public transit

Authors

• Xiaoran Qin
• Jintao Ke
• Hai Yang

Document Type

Journal Article

Publication Date

2025

Subject Area

place - urban, operations - coordination, economics - subsidy, organisation - regulation, ridership - demand, ridership - modelling

Keywords

on-demand ride-sourcing, public transit, regulations

Abstract

The rapid expansion of on-demand ride-sourcing services has revolutionized the landscape of multi-modal urban transport systems, particularly with regard to the public transit system. Ride-sourcing services can be either a substitute or complement to public transit. Regarding the complementary effects, ride-sourcing services can address first/last-mile problem to enhance public transit ridership, which aligns with the objective of the government to coordinate multiple travel modes. In this paper, we establish a mathematical model to characterize the complementary and substitution relationships between ride-sourcing and public transit services. Three market scenarios are compared and analyzed, including the laissez-faire market without government intervention, the market under a price-cap regulation, and the market under a subsidy policy. The insights could help understand how government regulations affect ride-sourcing platforms’ profit-pursuing decisions and the resulting social benefits, such as public transit ridership. Finally, we offer practical suggestions for the government to design the appropriate regulations to better coordinate ride-sourcing and public transit services, under situations with different demand-supply ratios. We prove that when the demand-supply ratio is high enough, it is unnecessary to introduce any regulation to promote public transit, whereas at a medium ratio, the government is able to set a critical value of decision variables in each policy such that all travelers use public transit.

Rights

Permission to publish the abstract has been given by Elsevier, copyright remains with them.

Comments

Transport Policy Home Page:

http://www.sciencedirect.com/science/journal/0967070X

Recommended Citation

Qin, X., Ke, J., & Yang, H., (2025). Government regulations for ride-sourcing services as substitute or complement to public transit. Transport Policy, 172, 103776.