Modelling the effects of metro and bike-sharing cooperation: Cost-sharing mode vs information-sharing mode

Abstract

Bike-sharing provides a key role in offering a solution to the first- and last-mile problem, and thus extends the service catchment areas of public transport and facilitates low-carbon travel in urban transport systems. Despite the fact that it has become popular for metro and bike-sharing operators to cooperate to improve their services in recent years, the effect of cooperation modes has largely been neglected in the literature. We thus develop a metro-lead Stackelberg game model to investigate the strategic interaction and potential integration between a bike-sharing operator and a metro operator under different cooperation modes; i.e., the cost-sharing mode (CS mode) and the information-sharing mode (IS mode). We analytically and numerically examine the impact of the CS and IS modes on the participants’ pricing and effort decisions. This paper highlights the value of a carefully designed cooperation mode on benefiting operators (profits) and society (demand for green travel). Specifically, the IS mode enables both operators to gain a profit increment, leading to a win-win situation from the profit point of view. This superior performance of the IS mode remains robust, regardless of whether the bike-sharing operator is fairness-neutral or fairness-concerned. The CS mode benefits the metro operator yet hurts the profitability of the bike-sharing operator. Interestingly, the CS mechanism can effectively promote the demand for connecting travel, which might explain the adoption of the CS mode by bike-sharing operators in practice. That is, the increased demand created by the CS mode caters to bike-sharing operators whose primary goal is to capture markets, commonly for new entrants. Essentially, the IS mode also has a positive effect on increasing demand, and the dominance of these two cooperation modes regarding the promotion of demand is sensitive to the cost efficiency of each operator. Additionally, we find that a greater degree of fairness concern weakens (strengthens) the superiority of the IS (CS) mode in both demand promotion and profit improvement. Our results provide novel insights into how cooperation mechanisms impact the integrated operation of metro and bike-sharing systems.