Abstract Business platforms delivering Mobility-as-a-Service (), alongside providing additional user services, have been shown to bring important price strategic interaction impacts which can be welfare improving. We show that the Integrator platform, whose structure alleviates harmful price externalities with two operators, such that it everywhere welfare dominates the Free-Market, can also limit beneficial competitive forces with more operators, reversing this welfare ordering. This is important since envisages platforms bringing together multiple operators and services in practice. However, calibrations show that where the Integrator platform fails to outperform the Free-Market (with higher operator numbers and lower substitutability), a new platform-based model that we introduce, is optimal. Furthermore, the Integrator is promoted in welfare terms in the presence of non-trivial marginal costs and mid- to high-end market demand elasticities, conditions both consistent with the inclusion in the journey mix of taxi cabs and other on-demand services which are common-place in offerings. We also introduce a number of extensions to the modelling framework incorporating additional real network characteristics. Though this can result in the welfare supremacy of the Integrator relative to the Free-Market being undermined, it again tends to be restored under mid- to high-range market elasticity calibrations. Finally, profit incentives tend to neither align across platform providers and operators, nor promote the welfare-best regime, indicating potential for regulatory oversight.
Highlights A MaaS business platform framework is extended from to the -operator case. Integrator welfare supremacy is not robust to higher or new network features. Integrator welfare dominance can return under mid/high industry elasticities. The Integrator and a new platform model, MTC, share the top welfare ranking. Profit and welfare incentives tend not to align across regimes.
Platform business models and strategic price interaction
2024-02-29
Article (Journal)
Electronic Resource
English
D21 , D43 , L13 , R40 , Platforms , MaaS , Strategic interaction , Transport network , Pricing
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