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What drives pricing behavior in Peer-to-Peer markets? Evidence from the carsharing platform BlaBlaCar

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  • Farajallah, Mehdi
  • Hammond, Robert G.
  • Pénard, Thierry

Abstract

We examine how price and demand are determined on peer-to-peer platforms and whether experience and reputation have the same impact as in traditional markets. We use data from the world's leading intercity carsharing platform, BlaBlaCar, which connects drivers with empty seats to riders. We find that pricing decisions evolve as drivers gain experience with the platform. More-experienced drivers set lower prices and, controlling for price, sell more seats. Our interpretation is that more-experienced drivers on BlaBlaCar learn to lower their prices as they gain experience; accordingly, more-experienced drivers earn more revenue per trip. In total, our results suggest that peer-to-peer markets such as BlaBlaCar share some characteristics with other types of peer-to-peer markets such as eBay but remain a unique and rich setting in which there are many new insights to be gained.

Suggested Citation

  • Farajallah, Mehdi & Hammond, Robert G. & Pénard, Thierry, 2019. "What drives pricing behavior in Peer-to-Peer markets? Evidence from the carsharing platform BlaBlaCar," Information Economics and Policy, Elsevier, vol. 48(C), pages 15-31.
    • Handle: RePEc:eee:iepoli:v:48:y:2019:i:c:p:15-31
    DOI: 10.1016/j.infoecopol.2019.01.002
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    2. Monchambert, Guillaume, 2020. "Why do (or don’t) people carpool for long distance trips? A discrete choice experiment in France," Transportation Research Part A: Policy and Practice, Elsevier, vol. 132(C), pages 911-931.
    3. Jinzhao Du & Ying Lei, 2022. "Information design of matching platforms when user preferences are bidimensional," Production and Operations Management, Production and Operations Management Society, vol. 31(8), pages 3320-3336, August.
    4. Ciro Troise & Elia Ferrara & Mario Tani & Ornella Papaluca, 2020. "Perspectives of the App Economy: Tenets of the Innovative Phenomenon," International Business Research, Canadian Center of Science and Education, vol. 13(3), pages 1-1, March.
    5. Wells, Peter & Wang, Xiaobei & Wang, Liqiao & Liu, Haokun & Orsato, Renato, 2020. "More friends than foes? The impact of automobility-as-a-service on the incumbent automotive industry," Technological Forecasting and Social Change, Elsevier, vol. 154(C).
    6. Dianzhuo Zhu, 2022. "Ridesharing: Its potential, challenges, and future in France," Working Papers hal-03994900, HAL.
    7. Dalia Perkumienė & Milita Vienažindienė & Biruta Švagždienė, 2021. "The Sharing Economy towards Sustainable Tourism: An Example of an Online Transport-sharing Platform," Sustainability, MDPI, vol. 13(19), pages 1-18, October.
    8. Ru Jia & Shanshan Wang, 2021. "Investigating the Impact of Professional and Nonprofessional Hosts’ Pricing Behaviors on Accommodation-Sharing Market Outcome," Sustainability, MDPI, vol. 13(21), pages 1-16, November.
    9. Monchambert, Guillaume, 2020. "Why do (or don’t) people carpool for long distance trips? A discrete choice experiment in France," Transportation Research Part A: Policy and Practice, Elsevier, vol. 132(C), pages 911-931.
    10. Dowling, Katharina & Manchanda, Puneet & Spann, Martin, 2021. "The existence and persistence of the pay-per-use bias in car sharing services," International Journal of Research in Marketing, Elsevier, vol. 38(2), pages 329-342.
    11. Yeung, Timothy Yu-Cheong & Zhu, Dianzhuo, 2022. "Intercity ridesharing to the rescue: Capacity flexibility and price stability of BlaBlaCar during the 2018 French railway strike," Transportation Research Part A: Policy and Practice, Elsevier, vol. 164(C), pages 270-290.
    12. Ivaldi, Marc & Palikot, Emil, 2023. "Sharing when stranger equals danger: Ridesharing during Covid-19 pandemic," Transport Policy, Elsevier, vol. 141(C), pages 221-231.
    13. Olga Abramova, 2022. "No matter what the name, we’re all the same? Examining ethnic online discrimination in ridesharing marketplaces," Electronic Markets, Springer;IIM University of St. Gallen, vol. 32(3), pages 1419-1446, September.
    14. Meijian Yang & Enjun Xia, 2021. "A Systematic Literature Review on Pricing Strategies in the Sharing Economy," Sustainability, MDPI, vol. 13(17), pages 1-28, August.

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