Going the First/Last-Mile: Ride-Hailing Services and Mass Rapid Transport

Motorbike-based online ride-hailing services are widespread in many of the developing world’s most congested cities. Their availability often predates the construction of public mass rapid transit (MRT) systems, and has been argued to undermine the viability of such investments as people simply continue using ride-hailing services given their convenience, flexibility and affordability. Using an event study research design leveraging proprietary, high-frequency data from one of Indonesia’s largest ride-hailing services, Gojek, we show that the opening of Jakarta’s first MRT line led to large increases in ride-hailing activity in the vicinities of the newly opened stations. This was accompanied by a significant decline in the average distance of the ride-hailing trips made to and from those stations. Ride-hailing services complement the MRT by providing important first and last mile connectivity, thereby significantly improving the MRT system’s ability to attract customers beyond immediate walking distance from its stations.