Coping with the Unexpected: Taxi Drivers' Responses to Cancellations and No-shows

10:00-11:30, Thursday, June 18, 2020

Tencent Meeting (Meeting ID: 391 605 977)

Dr. Hai Long Duong is now a postdoctoral fellow at Business School, National University of Singapore (NUS). He received his Ph.D. in economics from NUS in 2017. His research interests are Behavioral Economics, Quantitative Marketing, Applied Microeconometrics and Structural Modeling.

We study how taxi drivers cope with unexpected negative events -- booking cancellations and passenger no-shows (CNS), the impact of their coping strategy on daily income, and the underlying mechanism. We find that drivers work longer and earn more per hour following CNS, apparently seeking to compensate for the loss from such adverse events, and they end up earning more on shifts with CNS. They achieve higher productivity and earnings by reducing break time, taking more jobs, driving faster, driving to places with more earning opportunities, and having more time with passengers on board. We uncover the likely mechanism driving these responses to be income targeting motive: The effects of CNS are strongest when cumulative income is close to the average shift income and become insignificant when the income is too low or too high. The effects are most pronounced in the first hour and fade away quickly afterwards. Our results demonstrate the resilience of platform markets and shed new light on how service providers react to negative shocks due to changes in customers' needs.

For more information of the seminar, scan the following QR code(s) to join Tencent QQ group (904 544 292) or WeChat group named "IAER Seminar", please.

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