Pricing Strategy of Car-Hailing Platform with Maximizing Social Welfare

Abstract

From the government's point of view, this paper studies the platform pricing strategy based on the maximization of social welfare for the car-hailing platform, drivers and passengers. To this end, the queuing theory and the process of birth and death process are used to describe the flow process of the driver in the car-hailing platform, and the price generation mechanism of the existing platform is simulated according to the dynamic pricing strategy to construct the social welfare maximization model. Secondly, The Brouwer fixed-point theorem examines the existence of the model solution. Finally, based on the fmincon function in Matlab, the model is solved. Research shows that the established model can not only calculate the optimal pricing strategy of the platform, but also analyze the impact of changes in basic parameters (average riding time, probability of drivers leaving the system, etc.) on the platform pricing strategy.