Abstract
Clarifying the rational choice strategy of local governments and enterprises is crucial for promoting control on the failure of taxis and online car-hailing service companies to fulfill their social responsibilities. The local government can reduce the negative externalities and irresponsibility of such companies by improving the regulatory system; thus, it is important to build a governance model that bridges tradition and modernity. This paper, on the basis of summarizing the achievements of the predecessors, builds a mixed dynamic game model among the local government, online car-hailing service companies, and taxi companies; analyzes the relationship between local government preference, execution, and governance of irresponsible enterprise behaviors; and analyzes the equilibrium solution between local government and duopoly enterprises behavior game deeply. The results show that the key to governance irresponsible companies is to make the punishment cost higher than the cost savings for irresponsible behaviors; no matter what the preference of the local government no-governance of online car-hailing service companies’ irresponsible behaviors may persist; and local government ambivalence when regulating irresponsible companies is derived from the complex relationship between social benefits and company interests. Finally, through the analysis of the equilibrium results for the above model, this paper provides suggestions on regulatory policies so as to provide theoretical support and a decision-making basis for establishing scientific, universal, and feasible governance policies and offering responsible methods of urban transportation.
Highlights
Online car-hailing services such as Uber and Didi Chuxing have been on the rise, with their low-price, highquality model, convenience, and other advantages impacting the traditional taxi market
The results show that the key to governance irresponsible companies is to make the punishment cost higher than the cost savings for irresponsible behaviors; no matter what the preference of the local government no-governance of online car-hailing service companies’ irresponsible behaviors may persist; and local government ambivalence when regulating irresponsible companies is derived from the complex relationship between social benefits and company interests
Irresponsible behaviors of the local government-controlled enterprises can be divided into three stages: (1) local government promulgates the management policy of irresponsible enterprises—that is, compensates the victim k times the loss caused by irresponsible enterprises; (2) a production decision is made by online car-hailing service and taxi companies; and (3) the local government implements regulatory policies in accordance with the loss caused to stakeholders by the irresponsible behavior of online car-hailing service companies
Summary
Online car-hailing services such as Uber and Didi Chuxing have been on the rise, with their low-price, highquality model, convenience, and other advantages impacting the traditional taxi market. This has underlined the poor service and refusal to take passengers among some taxi drivers; taxi drivers have maintained pressure against local governments by interest struggle [1]. Mathematical Problems in Engineering take social responsibility by traditional methods, in order to obtain balance of the two market subjects’ interests for taxi enterprises and online car-hailing service companies. Questions of how to make the government provide differentiated traffic governance policies to balance the two market subjects’ (online car-hailing service companies and taxi companies) interests and ensure fair competition, and ensure they are fulfilling their social responsibility, have become urgent problems to be solved
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