IDEAS home Printed from https://ideas.repec.org/a/eee/jeborg/v166y2019icp125-137.html
   My bibliography  Save this article

When a few undermine the whole: A class of social dilemmas in ridesharing

Author

Listed:
  • Rapoport, Amnon
  • Qi, Hang
  • Mak, Vincent
  • Gisches, Eyran J.

Abstract

We investigate a class of social dilemmas that arise when a heterogeneous group of agents potentially benefit from a joint enterprise such as ridesharing. Participation in the enterprise incurs positive externalities to other participants; social welfare is maximized with full participation. However, if some agents find it a dominant strategy to opt out, then the potential benefit from the enterprise will decrease, leading to more members opting out. This iterated disincentivizing effect could result in massive welfare losses. We construct a game-theoretical model to implement these social dilemmas and report experimental evidence for their existence and welfare impact.

Suggested Citation

  • Rapoport, Amnon & Qi, Hang & Mak, Vincent & Gisches, Eyran J., 2019. "When a few undermine the whole: A class of social dilemmas in ridesharing," Journal of Economic Behavior & Organization, Elsevier, vol. 166(C), pages 125-137.
  • Handle: RePEc:eee:jeborg:v:166:y:2019:i:c:p:125-137
    DOI: 10.1016/j.jebo.2019.08.015
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S0167268119302628
    Download Restriction: Full text for ScienceDirect subscribers only

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Martin G. Kocher & Peter Martinsson & Kristian Ove R. Myrseth & Conny E. Wollbrant, 2017. "Strong, bold, and kind: self-control and cooperation in social dilemmas," Experimental Economics, Springer;Economic Science Association, vol. 20(1), pages 44-69, March.
    2. Ernst Fehr & Klaus M. Schmidt, 1999. "A Theory of Fairness, Competition, and Cooperation," The Quarterly Journal of Economics, Oxford University Press, vol. 114(3), pages 817-868.
    3. Breitmoser, Yves & Tan, Jonathan H.W. & Zizzo, Daniel John, 2014. "On the beliefs off the path: Equilibrium refinement due to quantal response and level-k," Games and Economic Behavior, Elsevier, vol. 86(C), pages 102-125.
    4. Jennifer Zelmer, 2003. "Linear Public Goods Experiments: A Meta-Analysis," Experimental Economics, Springer;Economic Science Association, vol. 6(3), pages 299-310, November.
    5. Van Huyck, John B & Battalio, Raymond C & Beil, Richard O, 1990. "Tacit Coordination Games, Strategic Uncertainty, and Coordination Failure," American Economic Review, American Economic Association, vol. 80(1), pages 234-248, March.
    6. Vinayak Dixit & Laurent Denant-Boemont, 2014. "Is Equilibrium in Transport Pure Nash, Mixed or Stochastic? Evidence from Laboratory Experiments," Post-Print halshs-01103472, HAL.
    7. Emmanuel Dechenaux & Shakun Mago & Laura Razzolini, 2014. "Traffic congestion: an experimental study of the Downs-Thomson paradox," Experimental Economics, Springer;Economic Science Association, vol. 17(3), pages 461-487, September.
    8. Avinash Dixit, 2003. "Clubs with Entrapment," American Economic Review, American Economic Association, vol. 93(5), pages 1824-1829, December.
    9. Gabuthy Yannick & Neveu Matthieu & Denant-Boemont Laurent, 2006. "The Coordination Problem in a Structural Model of Peak-Period Congestion: An Experimental Study," Review of Network Economics, De Gruyter, vol. 5(2), pages 1-26, June.
    10. Morgan, John & Orzen, Henrik & Sefton, Martin, 2009. "Network architecture and traffic flows: Experiments on the Pigou-Knight-Downs and Braess Paradoxes," Games and Economic Behavior, Elsevier, vol. 66(1), pages 348-372, May.
    11. Selten, R. & Chmura, T. & Pitz, T. & Kube, S. & Schreckenberg, M., 2007. "Commuters route choice behaviour," Games and Economic Behavior, Elsevier, vol. 58(2), pages 394-406, February.
    12. Rachel Croson & Melanie Marks, 2000. "Step Returns in Threshold Public Goods: A Meta- and Experimental Analysis," Experimental Economics, Springer;Economic Science Association, vol. 2(3), pages 239-259, March.
    13. Furuhata, Masabumi & Dessouky, Maged & Ordóñez, Fernando & Brunet, Marc-Etienne & Wang, Xiaoqing & Koenig, Sven, 2013. "Ridesharing: The state-of-the-art and future directions," Transportation Research Part B: Methodological, Elsevier, vol. 57(C), pages 28-46.
    14. Terry E. Daniel & Eyran J. Gisches & Amnon Rapoport, 2009. "Departure Times in Y-Shaped Traffic Networks with Multiple Bottlenecks," American Economic Review, American Economic Association, vol. 99(5), pages 2149-2176, December.
    15. Arnott, Richard & de Palma, Andre & Lindsey, Robin, 1990. "Economics of a bottleneck," Journal of Urban Economics, Elsevier, vol. 27(1), pages 111-130, January.
    16. Eyran Gisches & Amnon Rapoport, 2012. "Degrading network capacity may improve performance: private versus public monitoring in the Braess Paradox," Theory and Decision, Springer, vol. 73(2), pages 267-293, August.
    17. Iida, Yasunori & Akiyama, Takamasa & Uchida, Takashi, 1992. "Experimental analysis of dynamic route choice behavior," Transportation Research Part B: Methodological, Elsevier, vol. 26(1), pages 17-32, February.
    18. Xuan Lu & Song Gao & Eran Ben-Elia & Ryan Pothering, 2014. "Travelers' Day-to-Day Route Choice Behavior with Real-Time Information in a Congested Risky Network," Mathematical Population Studies, Taylor & Francis Journals, vol. 21(4), pages 205-219, December.
    19. Ananish Chaudhuri, 2011. "Sustaining cooperation in laboratory public goods experiments: a selective survey of the literature," Experimental Economics, Springer;Economic Science Association, vol. 14(1), pages 47-83, March.
    20. Vincent Mak & Eyran J. Gisches & Amnon Rapoport, 2015. "Route vs. Segment: An Experiment on Real-Time Travel Information in Congestible Networks," Production and Operations Management, Production and Operations Management Society, vol. 24(6), pages 947-960, June.
    21. Vinayak Dixit & Laurent Denant-Boemont, 2014. "Is equilibrium in transport pure Nash, mixed or Stochastic?," Post-Print halshs-02319751, HAL.
    22. Matthew McGinty & Garrett Milam, 2013. "Public goods provision by asymmetric agents: experimental evidence," Social Choice and Welfare, Springer;The Society for Social Choice and Welfare, vol. 40(4), pages 1159-1177, April.
    23. Rapoport, Amnon & Mak, Vincent & Zwick, Rami, 2006. "Navigating congested networks with variable demand: Experimental evidence," Journal of Economic Psychology, Elsevier, vol. 27(5), pages 648-666, October.
    24. Rapoport, Amnon & Kugler, Tamar & Dugar, Subhasish & Gisches, Eyran J., 2009. "Choice of routes in congested traffic networks: Experimental tests of the Braess Paradox," Games and Economic Behavior, Elsevier, vol. 65(2), pages 538-571, March.
    Full references (including those not matched with items on IDEAS)

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:jeborg:v:166:y:2019:i:c:p:125-137. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Dana Niculescu). General contact details of provider: http://www.elsevier.com/locate/jebo .

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.