Regulating taxi services in the presence of congestion externality

In most large cities, the taxi industry is subject to various types of regulation, such as entry restrictions and price controls, and economists have examined the economic consequences of such regulation extensively. Unfortunately, in conventional economic analyses of competition and regulation in the taxi industry little attention has been paid to one important issue: congestion externalities due to both occupied and vacant taxi movements together with normal vehicular traffic. This study investigates the nature of equilibrium and regulation in the taxi market by taking account of congestion externalities and adopting a realistic distance-based and delay-based taxi fare structure. The monopoly, the social optimum and the stable competitive solutions are examined and illustrated with a numerical example.     

Predicting market potential and environmental benefits of deploying electric taxis in Nanjing,China

This paper investigates the market potential and environmental benefits of replacing internal combustion engine (ICE) vehicles with battery electric vehicles (BEVs) in the taxi fleet in Nanjing, China. Vehicle trajectory data collected by onboard global positioning system (GPS) units are used to study the travel patterns of taxis. The impacts of charger power, charging infrastructure coverage, and taxi apps on the feasibility of electric taxis are quantified, considering taxi drivers’ recharging behavior and operating activities. It is found that (1) depending on the charger power and coverage, 19% (with AC Level 2 chargers and 20% charger network coverage) to 56% (with DC chargers and 100% charger network coverage) of the ICE vehicles can be replaced by electric taxis without driving pattern changes; (2) by using taxi apps to find nearby passengers and charging stations, drivers could utilize the empty cruising time to charge the battery, which may increase the acceptance of BEVs by up to 82.6% compared to the scenario without taxi apps; and (3) tailpipe emissions in urban areas could be significantly reduced with taxi electrification: a mixed taxi fleet with 46% compressed-natural-gas-powered (CNG) and 54% electricity-powered vehicles can reduce the tailpipe emissions by 48% in comparison with the fleet of 100% CNG taxis.     

Taxi services with search frictions and congestion externalities

Built upon the previous studies, this paper incorporates both bilateral taxi–customer search frictions and congestion externalities into the economic analyses of the equilibrium properties of taxi markets. We take account of congestion externalities by adopting a realistic distance‐based and delay‐based taxi fare structure. We first investigate comparative static effects of regulatory variables of taxi fare and fleet size on the market and then examine the properties of the Pareto‐efficient solutions for simultaneous maximization of social welfare and taxi profit in the congested market. Copyright © 2012 John Wiley & Sons, Ltd.     

Analysis of taxi demand and supply in New York City: implications of recent taxi regulations

This paper investigates temporal and weather-related variation in taxi trips in New York City. A taxi trip data-set with 147 million records covering 10 months of activity is used. It is shown that there are substantial variations in ridership, taxi supply, trip distance, and pickup frequency for different time periods and weather conditions. These variations, in turn, cause variations in driver revenues which is one of the main measures of taxi supply–demand equilibrium. The findings are then used to discuss the anticipated impacts of two recently enacted taxi regulation changes: the first fare increase since 2006 and the E-Hail pilot program which allows taxi hailing with smart phone applications. The fare increase is estimated to cause varying levels of revenue increase for different time periods. E-Hail apps are not expected to offer considerable improvements at all times, but rather when both adequate taxi supply and demand occur simultaneously.     

Nonlinear pricing of taxi services

This paper examines the effects of nonlinear fare structures in taxi markets using an extended taxi model with an explicit consideration of perceived profitability. The expected profit, defined as the profit per unit time (inclusive of both occupied and vacant taxi times), that a taxi driver expects to receive from picking up a customer in a particular zone or location, has great impact on the taxi driver’s choice of location in the search for customers. The fare structure directly governs the profitability of taxi rides of different distances originating from different locations. With these explicit considerations, the extended model is intended to look into the market effects of adopting a nonlinear fare structure with declining incremental charges. The proposed nonlinear fare structure could help restore a level-playing field for taxi operators whose businesses have been affected by some taxi drivers who resort to practices such as offering fare discounts or accepting requests for discounted fares from passengers for long-haul trips. Analysis of sensitivity of social welfare and profit gain as well as taxi/customer wait/search times is conducted with respect to the parameters in the nonlinear fare structure for the Hong Kong taxi market, and Pareto-improving nonlinear fare amendments are identified that neither disadvantage any customer nor reduce the taxi operators’ profits.     

A macroscopic taxi model for passenger demand,taxi utilization and level of services

In most urban areas taxi services are subject to various types of regulation such as entry restriction and price control. However, effective intervention depends on generating and using suitable information on the demand-supply equilibrium of the taxi market. This paper develops a simultaneous equation system of passenger demand, taxi utilization and level of services based on a taxi service situation found in the urban area of Hong Kong over the last ten years. A set of variables is introduced including number of licensed taxis, taxi fare, disposable income, occupied taxi journey time as exogenous variables and daily taxi passenger demand, passenger waiting time, taxi availability, taxi utilization and average taxi waiting time as endogenous variables. These variables are coupled together through a system of nonlinear simultaneous equations whose parameters are estimated from survey data. The simultaneous equation system can be used to obtain useful regulatory information to assist with the decisions concerning the restriction over the number of taxi licenses and the fixing of the taxi fare structure as well as a range of service quality control. This revised version was published online in June 2006 with corrections to the Cover Date.     

Environmental charges in airline markets

Over the last two decades many airline markets have been deregulated, resulting in increased competition and use of different types of networks. At the same time there has been an intense discussion on environmental taxation of airline traffic. It is likely that an optimal environmental charge and the effects of a charge differ between different types of aviation markets. In this paper, we derive optimal flight (environmental) charges for different types of airline markets. The first type of market is a multiproduct monopoly airline operating either a point-to-point network or a hub-and-spoke network. The optimal charge is shown to be similar in construction to an optimal charge for a monopolist. We also compare the environmental impact of the two types of networks. Given no differences in marginal damages between airports we find that an airline will always choose the network with the highest environmental damages. The second type of market we investigate is a multiproduct duopoly, where two airlines compete in both passengers and flights. The formulation of the optimal charge is similar to the optimal charge of a single product oligopoly. However, we also show that it is, because of strategic effects, difficult to determine the effects of the charge on the number of flights.     

Deregulating European aviation — A case study

European international scheduled aviation has been characterised by bans on market entry, price collusion, and capacity sharing. High fares were charged compared to world standards and the fares charged by European charter airlines.In May 1986 new entrants with pricing freedom were permitted on the London-Dublin route which was then the third largest in European scheduled international aviation. Prior to deregulation the route experienced high fare growth. The unrestricted fare ex-London increased 72.6 per cent compared to a Retail Price Index increase of 41.5 per cent. There was a growth in passenger numbers in the years 1980–85 of 2.8 per cent.Since deregulation passenger numbers have risen to 2.3 million compared to 994,000 before deregulation. Fares have declined by an estimated 37 per cent ex-Dublin and 42 per cent ex-London in real terms. There have been four cases of market entry and one of market exit. The estimated share of the new entrants in the second half of 1989 was 28 per cent. The preregulation earnings data of Aer Lingus, the market leader, indicated that protection allowed staff to earn economic rents. A two-tier structure was introduced in response to competition.Remaining barriers to contestability in UK/Ireland aviation include hub airport dominance, ground handling monopolies, and the ability of airlines with routes in both regulated and deregulated markets to engage in geographical price discrimination against airlines with routes in deregulated markets only. A pro-contestability aviation policy in Europe will require measures to prevent the abuse of dominant positions by established airlines over new market entrants and to prevent collusion between established airlines.     

Can value capture work in a car dependent city? Willingness to pay for transit access in Perth,Western Australia

This paper investigates the impact of transit on urban land markets in the highly car dependent corridors of Perth with a focus on where new fast rail transit services have recently been built. It determines people’s willingness to pay for transit access within different pedestrian catchments for each of the corridors based on hedonic price modelling using land value data on over 460,000 households. The case study uses cross sectional and panel data hedonic price modelling methodology for the calculation of willingness to pay for transit. It finds that land market increases of up to 40% can be achieved, and is particularly relevant to car dependent cities looking to capture the financial and economic value created to build transit extensions or entirely new systems, thus making a strong case for value capture funding of transit projects into car dependent suburbs and the potential for density increases near stations.     

Modeling taxi drivers’ decisions for improving airport ground access: John F. Kennedy airport case

Taxi service is an important component of airport ground access, which affects the economic competitiveness of an airport and its potential positive impact on the surrounding region. Airports across the globe experience both taxi shortages and excesses due to various factors such as the airport’s proximity to the city center, timing and frequency of flights, and the fare structure. Since taxi drivers are independent entities whose decisions affect the taxi supply at airports, it is important to understand taxi drivers’ decision mechanisms in order to suggest policies and to maintain taxi demand and supply equilibrium at the airports. In this paper, New York City (NYC) taxi drivers’ decisions about airport pick-ups or cruising for customers at the end of each trip is modeled using logistic regression based on a large taxi GPS dataset. The presented approach helps to quantify the potential impacts of parameters and to rank their influence for policy recommendations. The results reveal that spatial variables (mainly related to proximity) have the highest impact on taxi drivers’ airport pickup decisions, followed by temporal, environmental and driver-shift related variables. Along with supplementary information from unstructured taxi driver interviews, the model results are used to suggest policies for the improvement of John F. Kennedy (JFK) airport’s ground access and passenger satisfaction, i.e. the implementation of taxi driver frequent airport server punch cards and a time-specific ride share program.     

Estimating the effects of entry regulation in the Istanbul taxicab market

The economic literature shows that entry regulation in taxicab markets brings about a dramatic increase in medallion prices or license values of taxicabs. However, there is no study estimating what the effect of regulation is exactly on real medallion prices. We develop a model to estimate the effect of entry restrictions in the Istanbul taxicab market over real medallion prices and inflation. Our findings contribute that entry regulation in taxicab markets increases medallion prices. Moreover, we find that entry regulation in Istanbul pressures inflation rates as well.     

A two-stage approach to modeling vacant taxi movements

In this paper, a two-stage modeling approach is proposed to predict vacant taxi movements in searching for customers. The taxi movement problem is formulated into a two-stage model that consists of two sub-models, namely the first and second stage sub-models. The first stage sub-model estimates the zone choice of vacant taxi drivers for customer-search and the second stage sub-model determines the circulation time and distance of vacant taxi drivers in each zone by capturing their local customer-search decisions in a cell-based network within the zone chosen in the first stage sub-model. These two sub-models are designed to influence each other, and hence an iterative solution procedure is introduced to solve for a convergent solution. The modeling concept, advantages, and applications are illustrated by the global positioning system data of 460 Hong Kong urban taxis. The results demonstrate that the proposed model formulation offers a great improvement in terms of root mean square error as compared with the existing taxi customer-search models, and show the model capabilities of predicting the changes in vacant taxi trip distributions with respect to the variations in the fleet size and fare. Potential taxi policies are investigated and discussed according to the findings to provide insights in managing the Hong Kong taxi market.     

Analogy of fixed route shared taxi (taxi khattee) and bus services under various demand density and economical conditions

Taxi khattee is a fixed route unregulated shared taxi. It is a very common mode of transportation in Iran. Fixed route, unscheduled operation, open, unlimited pick‐up and drop‐off locations, and share ride are common features of taxi khattees. Low passenger capacity and working in high demand corridors provides for the possibility of high service frequencies any time of the day. Taxi khattees are similar to jitneys, which are obsolete or illegal in many countries. The aim of this research is to design transit network of an area using taxi khattees in addition to buses. The methodology employed in this paper simultaneously considers the costs to the users and operators on the one hand, and those of the public non‐users on the other hand. Taxi khattees are used in the design of a multimodal network along with buses to characterize the appropriate economic domain for their use. Moreover, their operation indices are compared against those of buses. A sensitivity analysis is carried out on various performance measures. Results show taxi khattees should be used in areas where population density is low, work force is inexpensive, social costs are not considered in fare calculation, and users' value of time is high. The study contradicts the common belief that since taxi khattees provide a high frequency compared to buses, they are economically plausible to use in a transit fleet. Copyright © 2011 John Wiley & Sons, Ltd.     

Modeling urban taxi services in road networks: Progress,problem and prospect

Traditionally, many economists have examined the models and economics of urban taxi services under various types of regulation such as entry restriction and price control in an aggregate way. Only recently have we modeled urban taxi services in a network context. A realistic method has been proposed to describe vacant and occupied taxi movements in a road network and taxi drivers' search behavior for customers. A few extensions have been made to deal with demand elasticity and congestion effects together with development of efficient solution algorithms. Calibration and validation of the network taxi service models have been conducted towards their practical applications. This paper presents an overview of the research that has been carried out by the authors to develop network equilibrium models and solution algorithms for urban taxi services, and offers perspectives for future researches.     

广西出租汽车行业发展浅析

文章从广西出租汽车行业发展的现状出发,介绍了广西出租汽车企业的基本情况、出租汽车运力供给情况及出租汽车企业经营模式,分析了广西出租汽车行业存在的主要问题,提出了促进广西出租汽车行业发展的方法建议。     

How can the taxi industry survive the tide of ridesourcing? Evidence from Shenzhen,China

This paper aims to examine the impact of ridesourcing on the taxi industry and explore where, when and how taxis can compete more effectively. To this end a large taxi GPS trajectory data set collected in Shenzhen, China is mined and more than 2,700 taxis (or about 18% of all registered in the city) are tracked in a period of three years, from January 2013 to November 2015, when both e-hailing and ridesourcing were rapidly spreading in the city. The long sequence of GPS data points is first broken into separate “trips”, each corresponding to a unique passenger state, an origin/destination zone, and a starting/ending time. By examining the trip statistics, we found that: (1) the taxi industry in Shenzhen has experienced a significant loss in its ridership that can be indisputably credited to the competition from ridesourcing. Yet, the evidence is also strong that the shock was relatively short and that the loss of the taxi industry had begun to stabilize since the second half of 2015; (2) taxis are found to compete more effectively with ridesourcing in peak period (6–10 AM, 5–8 PM) and in areas with high population density. (3) e-hailing helps lift the capacity utilization rate of taxis. Yet, the gains are generally modest except for the off-peak period, and excessive competition can lead to severely under-utilized capacities; and (4) ridesourcing worsens congestion for taxis in the city, but the impact was relatively mild. We conclude that a dedicated service fleet with exclusive street-hailing access will continue to co-exist with ridesourcing and that regulations are needed to ensure this market operate properly.     

Migration of railway freight transport from command economy to market economy: The case of China

In recent years, Chinese railway freight transport has been facing great challenges from transport market reformation and economic expansion. Although the total volume of railway freight has been increasing, its market share has decreased greatly, especially at the beginning of migration from command economy to market economy. This paper considers four aspects believed to be responsible for the loss of the railway freight market share. First, we review the history and current situation of the Chinese railway freight transport and study the relationship between economic development and freight transport in China. Second, the causes resulting in the loss of the market share of railway freight are analysed in detail. Third, the current measures taken by Chinese Railways (CR) to restore its competitiveness are discussed. The effects of these measures on railway traffic volume, market share and productivity are also studied. Finally, the way forward for the future of CR is discussed. It is concluded that CR has not yet adapted sufficiently to new economic conditions, although in recent years progress has been made. Further reform will be needed.     

A data envelopment analysis model for evaluating the performance of taxi operators: a case study in Harbin,China

ABSTRACT

This paper measures the performance of taxi operators using data envelopment analysis (DEA) and the improvement of performance based on benchmarks. This includes basic DEA models and a cross efficiency model. In the present work, a sample set of 20 taxi operators are considered, and an evaluation indicator framework is constructed, which mainly involves the identification of decision-making units (DMUs) and the determination of input-output variables. The combined results of multiple DEA models are used to evaluate the performance of taxi operators in a case study of Harbin. The results highlight the significance of the combined application of multiple DEA models, especially a cross-efficiency model that can obtain more objective efficiency values. Finally, the benchmarking method is used to capture the achievements of best-performing operators and provide valuable improvement recommendations for inefficient operators. Conclusions provide a suitable basis for the operation and management of the taxi market.     

Fixed‐route taxi system: route network design and fleet size minimization problems

This paper introduces the taxi route network design problem (TXRNDP) for a fixed‐route taxi service operating in Iran and, in similar form, in various other developing countries. The service operates fairly similar to regular transit services in that vehicles are only permitted to follow a certain predetermined route on the network. The service is provided with small size vehicles and main features are that vehicles only depart if full and that there are no intermediate boarding stops. In Iran the service attracts a high modal share but requires better coordination which is the main motivation for the present study. We develop a mathematical programming model to minimize the total travel time experienced by passengers while constraining the number of taxi lines, the trip transfer ratio and the length of taxi lines. A number of assumptions are introduced in order to allow finding an exact rather than heuristic solution. We further develop a linear programming solution to minimize the number of taxis required to serve the previously found fixed‐route taxi network. Results of a case study with the city of Zanjan, Iran, illustrate the resulting taxi flows and suggest the capability of the proposed model to reduce the total travel time, the total waiting time and the number of taxi lines compared to the current taxi operation. Copyright © 2016 John Wiley & Sons, Ltd.