The impact of ride‐hailing services on the use of traditional taxis: Evidence from Chinese urban panel data

Abstract

Currently, opinions on whether and how ride-hailing services have impacted the use of traditional taxis are divided, and no consensus has been reached. This paper used panel data from 44 cities in China from 2010 to 2016 to estimate the impact of ride-hailing services on the use of traditional taxis by applying the multiperiod difference-in-difference (multiperiod DID) method and conducting a series of robustness tests. The results show that ride-hailing services have a large, negative impact on the use of traditional taxis, and this negative impact is more severe in eastern cities. These results suggest that in China it is necessary for traditional taxi operators to make changes and innovations to become more sustainable in response to pressure from ride-hailing services. Additionally, it is suggested that city governments in China pay greater attention to the impact of emerging ride-hailing services on traditional taxi services, embrace emerging modes of mobility, and create appropriate policies to coordinate the development of both new and traditional services.