On the Determinants of the Business Model of Online Ride-Hailing Market

In this paper, we focus on the business model of online ride-hailing platform and analyze the fundamental factors that determines the economic performance of online ride-hailing business model. We define the business model of platform economy in the perspective of organizational economics, and based on this definition, two types business model of online ride-hailing market are conceptually constructed. Then, we analyze the economic determinants that influence the adoption of the business model of the online ride-hailing platform. We find that, when the network effects is weak and the passengers' heterogeneity degree in service quality is low, the marketplace model dominates the online ride-hailing market and the market competition level is relatively low; when the network effects and passengers' heterogeneity degree are moderate, the marketplace model remains dominant, while the integration model will emerge in the market, and the proportion of two models depend on the level of network effects and passengers' heterogeneity degree; when the network effects and passengers' heterogeneity degree are all high, the marketplace model and the integration model will coexist, and the market competition is relatively high.