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Display Slot Competition and Multi-Homing in Ride-Hailing Aggregator Platforms: A Game-Theoretic Analysis of Profit and Welfare Implications

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  • Xuepan Guo

    (School of Economics and Management, Shanghai Maritime University, Shanghai 201306, China)

  • Guangnian Xiao

    (School of Economics and Management, Shanghai Maritime University, Shanghai 201306, China)

Abstract

The rise in aggregation platforms has reshaped the competitive ride-hailing market. Display slots (i.e., platform-determined ranking priority) have become a key tool for influencing order allocation. Their interaction with drivers’ multi-homing behavior poses new challenges for platform sustainability. This paper constructs a two-stage Stackelberg game model with one aggregator and two underlying ride-hailing platforms. Display slots enhance supply-side lock-in, while a waiting time function links passenger utility to demand allocation. Building on theoretical analysis of two-sided market competition and multi-homing effects, we propose two hypotheses: (H1) under specific conditions, competition for display slots may lead to a Prisoner’s Dilemma equilibrium, and (H2) the proportion of multi-homing drivers positively moderates this dilemma, thereby expanding its occurrence range. Numerical simulation results under baseline parameter settings reveal that display slots generate a supply-side amplification effect by locking in multi-homing drivers. In symmetric markets, a prisoner’s dilemma range exists where mutual purchase erodes collective profits; this range expands with the share of multi-homing drivers. Higher driver profit sensitivity raises the threshold required for display slots to be profitable. In asymmetric markets, dominant platforms (strong brands, low costs) gain more from display slots, potentially leading to unilateral purchasing. Social welfare effects of display slot competition depend on a critical threshold of waiting-time sensitivity: social welfare improves above the threshold and declines below it. This study clarifies the boundaries of display slots as supply-side non-price competitive tools, offering quantitative insights for aggregator platform design and regulatory policy. The findings carry managerial implications for platform strategy and policy aimed at sustainable development.

Suggested Citation

  • Xuepan Guo & Guangnian Xiao, 2026. "Display Slot Competition and Multi-Homing in Ride-Hailing Aggregator Platforms: A Game-Theoretic Analysis of Profit and Welfare Implications," Sustainability, MDPI, vol. 18(7), pages 1-31, April.
  • Handle: RePEc:gam:jsusta:v:18:y:2026:i:7:p:3625-:d:1915202
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