Static Equilibrium of Vehicle Dispatching in Multi-regional Ride-Hailing Markets

Abstract

This study introduces a comprehensive model to analyze a ride-hailing market in which multiple companies allocate their vehicles as decision variables across various regions to maximize their profits. The problem is formulated as a classical multi-player, non-cooperative game with coupled constraints on the actions of each company. Although the game is non-convex, and therefore lacks guarantees for the uniqueness of the Nash equilibrium, we propose an iterative algorithm to compute the equilibrium and check whether multiple equilibria occur for further analysis. Utilizing this algorithm, we conduct a numerical study to illustrate the model in a duopoly market with two regions characterized by distinct demand profiles.