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arXiv · 2302.14358

A Unified Representation Framework for Rideshare Marketplace Equilibrium and Efficiency

Alex Chin·Zhiwei Qin
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Abstract

Ridesharing platforms are a type of two-sided marketplace where ``supply-demand balance'' is critical for market efficiency and yet is complex to define and analyze. We present a unified analytical framework based on the graph-based equilibrium metric (GEM) for quantifying the supply-demand spatiotemporal state and efficiency of a ridesharing marketplace. GEM was developed as a generalized Wasserstein distance between the supply and demand distributions in a ridesharing market and has been used as an evaluation metric for algorithms expected to improve supply-demand alignment. Building upon GEM, we develop SD-GEM, a dual-perspective (supply- and demand-side) representation of rideshare market equilibrium. We show that there are often disparities between the two views and examine how this dual-view leads to the notion of market efficiency, in which we propose novel statistical tests for capturing improvement and explaining the underlying driving factors.

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Alex Chin, Zhiwei Qin. 2023-02-28. A Unified Representation Framework for Rideshare Marketplace Equilibrium and Efficiency. https://arxiv.org/abs/2302.14358

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