Abstract
Nowadays, the way of Internet travel in China presents diversified development. Rapid expansion in the personal mobile terminal and Internet infrastructure for the Internet travels to the ecosystem of development and evolution. This paper explores the influence of the expansion of the e-hailing ecological community on the urban taxi ecological community, and the problems of profit-seeking, rent-setting, and rent-seeking from the capital behind the e-hailing platform. With entrance into the urban travel ecosystem with ride-hailing platform enterprises and emerging business models, how does (venture) capital cause the change of the urban taxi ecology? Is it essentially the rent-setting and rent-seeking behavior of capital that obtains the market monopoly status of e-hailing? What are the difficulties for governments and the public in regulating rent-seeking in capital and emerging business models? The aim is to explore the new governing strategy of urban taxi ecology. The paper chooses the case of the DiDi e-hailing platform, and performs a study on the utility and indifference curves quantitatively, and constructs a rent-seeking liaison between platform’s entry into the market and the platform’s monopoly. In this paper, the ecological system of the taxi industry is first sorted out, and the community relationship between the traditional cruise taxi industry and the e-hailing industry, and their market supply and demand relationship are clarified. Secondly, from the main theoretical perspective of rent-seeking behavior, this paper analyzes the causes of the rent-setting rent-seeking behavior of e-hailing platform enterprises and the venture capital behind them, and the problems of public power supervision. As the red pack & subsidy market strategy changes the utility (indifference) curve of passengers, the consumption preference of passengers is more inclined to e-hailing. With the expansion of the e-hailing community, the e-hailing platform partly replaces the regulatory role of the government, and venture capital investors as rational-economic individuals, and its agency responsibilities and profit-seeking characteristics naturally form a contradictory pair. The introduction of competition is a means among market policies to break monopoly. Even so, commercial competitors are able to avoid laws or regulations by the means of commercial mergers or through the implementation of variable interest entities control. Governments should therefore seek to participate actively in the governance of such organizations.
Highlights
Nowadays, China’s Internet-based travel is developing in a diversified way
Medium-sized Enterprises, start-ups, and innovative economic development in an open innovation economy [1], which meets the situation of platform enterprises entering into an e-hailing market that combines the Internet of Things (IoT) and Big Data technologies, and that brings a new era of urban taxi economy
The illegalare taxis been out the urban market,who which saves the cost of demand side, taxis and e-hailing, which are on the supply side, and platform enterprises, establish a government’s enforcement
Summary
China’s Internet-based travel is developing in a diversified way. The rapid popularization of personal mobile terminals and Internet infrastructure enables the development and. The practice of a sharing economy in China stems from the spirit of trust, and of open data by governments and enterprises It is in line with the strategy of promoting economic growth with the “double engine” of “Mass Entrepreneurship and Innovation” national strategy. Medium-sized Enterprises (abbreviated SMEs), start-ups, and innovative economic development in an open innovation economy [1], which meets the situation of platform enterprises entering into an e-hailing market that combines the Internet of Things (IoT) and Big Data technologies, and that brings a new era of urban taxi economy. The complex and various dynamics in the relationship between open innovation and business performance are revealed by Yun’s research via a game of life simulation, a mathematical modeling simulation, and causal loop modeling [4]. This study tries to go an extra mile to explain the reason for the different focus on utilities from the supply side and demand side in China’s e-hailing platform, which causes governance problems in monitoring platform enterprises with a rent-seeking perspective
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