Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/271957 
Year of Publication: 
2023
Series/Report no.: 
CESifo Working Paper No. 10313
Publisher: 
Center for Economic Studies and ifo Institute (CESifo), Munich
Abstract: 
Ride-hailing applications create new challenges for governments providing transit services, but also create new opportunities to raise tax revenue. To shed light on the effect of taxing or subsidizing ride-hailing applications, we extend a pseudo-monocentric city model to include multiple endogenously chosen transportation modes, including ride-hailing applications and endogenous car ownership. We show that most tax and spending programs that cities have currently adopted mildly increase public transit usage. However, the model predicts more significant increases in public transit ridership when ride-hailing applications are subsidized as a "last-mile" provider. Our model indicates that whether ride-hailing services and public transit are substitutes or complements is a policy choice.
Subjects: 
ride-hailing
taxation
public transit
traffic congestion
optimal tolls
JEL: 
C60
H25
H71
L88
L98
R41
R51
Document Type: 
Working Paper
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