Sharing Economy: Making Supply Meet Demand

536 Pages·2019·7.74 MB·English

by  Ming Hu

Springer Series in Supply Chain Management
Ming Hu Editor
Sharing
Economy
Making Supply Meet Demand
Springer Series in Supply Chain Management
Volume 6
SeriesEditor
ChristopherS.Tang
UniversityofCalifornia
LosAngeles,CA,USA
Moreinformationaboutthisseriesathttp://www.springer.com/series/13081
Ming Hu
Editor
Sharing Economy
Making Supply Meet Demand
123
Editor
MingHu
RotmanSchoolofManagement
UniversityofToronto
Toronto,ON,Canada
ISSN2365-6395 ISSN2365-6409 (electronic)
SpringerSeriesinSupplyChainManagement
ISBN978-3-030-01862-7 ISBN978-3-030-01863-4 (eBook)
https://doi.org/10.1007/978-3-030-01863-4
LibraryofCongressControlNumber:2018964940
©SpringerNatureSwitzerlandAG2019
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Preface
Sharingeconomyreferstoamarketmodelthatenablesandfacilitatesthesharingof
accesstogoodsandservices.Forexample,Uberallowsriderstoshareacar.Airbnb
allowshomeownerstosharetheirextraroomswithrenters.Grouponcrowdsources
demands,enablingcustomerstosharethebenefitofdiscountedgoodsandservices,
whereasKickstartercrowdsourcesfunds,enablingbackerstofundaprojectjointly.
Unliketheclassicsupplychainsettingsinwhichafirmmakesinventoryandsupply
decisions,inasharingeconomy,supplyiscrowdsourcedandcanbemodulatedbya
platform.Thematching-supply-with-demandprocessinasharingeconomyrequires
novelperspectivesandtoolstoaddresschallengesandidentifyopportunities.
Thiseditedbookexaminesthechallengesandopportunitiesarisingfromtoday’s
sharing economy from an operations management perspective. Individual chapter
authorspresentstate-of-the-artresearchthatexaminesthegeneralimpactofsharing
economy on production and consumption, the intermediary role of a sharing plat-
form,crowdsourcingmanagement,andvariouscontext-basedoperationalproblems.
Toronto,Canada MingHu
March2018
v
Acknowledgments
This book cannot exist without the strong commitment of our colleagues. I am
grateful to each of the contributing authors for sharing their cutting-edge research
withus.IwouldliketothankProfessorChrisTang,theeditoroftheSpringerSeries
in Supply Chain Management, who has encouraged me to work on this book. I
amgratefultoMirkoJancfortypesettingeachchapterexceptionallycarefullyand
rigorously.
This work was financially supported by the Natural Sciences and Engineering
Research Council of Canada [Grant RGPIN-2015-06757]; the National Natural
Science Foundation of China (NSFC) [Grant No. 71772006]; the Rotman School
of Management, University of Toronto; and the program of Guanghua Thought
LeadershipatGuanghuaSchoolofManagement,PekingUniversity.
vii
Contents
1 Introduction................................................................. 1
MingHu
1.1 OverallStructure ..................................................... 1
1.2 ChapterHighlights ................................................... 2
1.2.1 PartI:ImpactofSharingEconomy........................ 2
1.2.2 PartII:IntermediaryRoleofaSharingPlatform ......... 3
1.2.3 PartIII:CrowdsourcingManagement..................... 6
1.2.4 PartIV:Context-BasedOperationalProblemsin
SharingEconomy........................................... 7
References.................................................................... 8
PartI ImpactofSharingEconomy
2 Peer-to-PeerProductSharing............................................. 11
SaifBenjaafar,GuangwenKong,XiangLi,andCostasCourcoubetis
2.1 Introduction........................................................... 12
2.2 LiteratureReview .................................................... 15
2.3 ModelDescription.................................................... 17
2.3.1 MatchingSupplywithDemand............................ 19
2.4 EquilibriumAnalysis................................................. 21
2.4.1 Impact of Collaborative Consumption on
OwnershipandUsage ...................................... 22
2.4.2 ImpactofCollaborativeConsumptiononConsumers.... 25
2.5 ThePlatform’sProblem.............................................. 26
2.5.1 TheFor-ProfitPlatform .................................... 27
2.5.2 TheNot-for-ProfitPlatform................................ 29
2.5.3 SystemswithNegativeExternalities....................... 31
2.5.4 The Impact of Extra Wear and Tear and
InconvenienceCosts........................................ 33
2.6 ConcludingComments............................................... 33
References.................................................................... 35
ix
x Contents
3 The Strategic and Economic Implications of
Consumer-to-ConsumerProductSharing............................... 37
BaojunJiangandLinTian
3.1 Introduction........................................................... 37
3.2 ModelingFramework ................................................ 40
3.3 EffectsofSharingonFirm’sPricingStrategy,Profit,and
ConsumerSurplus.................................................... 43
3.4 EffectsofSharingonProductQualityandDistributionChannel.. 48
3.4.1 EffectsofSharingonProductQuality..................... 48
3.4.2 EffectsofSharingonDistributionChannel............... 49
3.5 ConclusionsandDiscussions........................................ 51
References.................................................................... 53
4 OperationalFactorsintheSharingEconomy:AFramework......... 55
TunayI.Tunca
4.1 Introduction........................................................... 55
4.2 TheFramework....................................................... 56
4.3 Examples ............................................................. 60
4.3.1 RideSharing................................................ 61
4.3.2 GroupBuying............................................... 64
4.4 ConcludingRemarks................................................. 66
References.................................................................... 68
5 RideSharing ................................................................ 73
SiddharthaBanerjeeandRameshJohari
5.1 Introduction........................................................... 73
5.2 AnatomyofaModernRidesharingPlatform ....................... 75
5.2.1 Timescales .................................................. 75
5.2.2 StrategicChoices ........................................... 76
5.2.3 OperationandMarketDesign.............................. 77
5.3 AModelingFrameworkforRidesharingPlatforms................ 77
5.3.1 ModelingStochasticDynamicsofthePlatform .......... 78
5.3.2 PlatformControls........................................... 81
5.3.3 PlatformObjectives......................................... 83
5.3.4 LocalControlsandClosedQueueingModels............. 84
5.3.5 ModelingEndogenousEntryofDrivers................... 86
5.4 AnalyzingtheModel:KeyFindings ................................ 87
5.4.1 Fast-TimescaleControlofPlatformDynamics ........... 88
5.4.2 TheSlowTimescale:PricingandDriverEntry ........... 89
5.5 RelatedLiterature .................................................... 92
5.6 Conclusion............................................................ 95
References.................................................................... 96
Contents xi
PartII IntermediaryRoleofaSharingPlatform
6 The Role of Surge Pricing on a Service Platform with
Self-SchedulingCapacity .................................................. 101
GerardP.Cachon,KaitlinM.Daniels,andRubenLobel
6.1 Introduction........................................................... 102
6.2 LiteratureReview .................................................... 103
6.3 Model................................................................. 105
6.4 ProfitabilityofCommissionContract ............................... 108
6.5 ImpactofDynamicPricesonConsumers........................... 110
6.6 Conclusion............................................................ 111
References.................................................................... 112
7 Time-Based Payout Ratio for Coordinating Supply
andDemandonanOn-DemandServicePlatform...................... 115
JiaruBai,KutC.So,ChristopherS.Tang,Xiqun(Michael)Chen,
andHaiWang
7.1 Introduction........................................................... 116
7.2 LiteratureReview .................................................... 117
7.3 AModelofWait-TimeSensitiveDemandandEarnings
SensitiveSupply...................................................... 119
7.3.1 CustomerRequestRateλandPriceRatep............... 120
7.3.2 NumberofParticipatingProviderskandWageRatew .. 120
7.3.3 ProblemFormulation....................................... 122
7.4 TheBaseModel...................................................... 122
7.4.1 SpecialCase1:WhenthePayoutRatiow/pIsFixed.... 124
7.4.2 Special Case 2: When the Service Level Is
ExogenouslyGiven......................................... 125
7.5 NumericalIllustrationsBasedonDidiData ........................ 127
7.5.1 BackgroundInformation ................................... 127
7.5.2 NumberofRidesandDriversAcrossDifferentHours ... 128
7.5.3 TravelDistanceandTravelSpeed ......................... 128
7.5.4 PricingandWageRates .................................... 129
7.5.5 StrategicFactorsandTheirImplications.................. 130
7.5.6 NumericalExamplesforIllustrativePurposes............ 130
7.6 Conclusion............................................................ 134
References.................................................................... 135
8 PricingandMatchingintheSharingEconomy......................... 137
YiweiChen,MingHu,andYunZhou
8.1 Introduction........................................................... 138
8.1.1 Two-SidedPricing.......................................... 138
8.1.2 Two-SidedMatching ....................................... 138
8.1.3 PricingandMatchingUnderStrategicBehavior.......... 140
xii Contents
8.2 Two-SidedPricingandFixedCommission ......................... 141
8.2.1 ThePriceandWageOptimizationProblem............... 141
8.2.2 TheFixedCommissionContract .......................... 143
8.2.3 NumericalStudy............................................ 145
8.3 DynamicMatchingwithHeterogeneousTypes..................... 146
8.3.1 PriorityPropertiesoftheOptimalMatchingPolicy ...... 147
8.3.2 BoundandHeuristic........................................ 151
8.4 PricingandMatchingwithStrategicSuppliersandCustomers.... 153
8.4.1 UpperBoundoftheIntermediary’sOptimalProfit....... 157
8.4.2 ASimpleDynamicPolicy:AsymptoticOptimality ...... 158
8.5 Conclusion............................................................ 163
References.................................................................... 163
9 Large-ScaleServiceMarketplaces:TheRole
oftheModeratingFirm.................................................... 165
GadAllon,AchalBassamboo,andErenB.Çil
9.1 Introduction........................................................... 165
9.2 LiteratureReview .................................................... 168
9.3 ModelFormulation................................................... 170
9.4 No-InterventionModel............................................... 171
9.4.1 CharacterizationofSPNE.................................. 173
9.5 OperationalEfficiencyModel ....................................... 175
9.5.1 CharacterizationoftheMarketEquilibrium............... 178
9.6 CommunicationEnabledModel..................................... 185
9.6.1 Characterizationofthe(δ,(cid:4))-MarketEquilibrium........ 186
9.7 AMarketplacewithNon-identicalAgents.......................... 188
9.8 Conclusion............................................................ 189
References.................................................................... 191
10 InducingExplorationinServicePlatforms.............................. 193
KostasBimpikisandYiangosPapanastasiou
10.1 Introduction........................................................... 193
10.2 RelatedLiterature .................................................... 194
10.3 IllustrativeExample.................................................. 197
10.4 BenchmarkModel.................................................... 198
10.5 InducingExploration................................................. 199
10.5.1 StrategicInformationDisclosure .......................... 202
10.5.2 TheValueofInformationObfuscation .................... 205
10.5.3 MinimizingRegret.......................................... 206
10.5.4 IncentivizingCustomersUsingPayments................. 208
10.6 PromisingDirections................................................. 210
10.6.1 LearninginDynamicContests............................. 210
10.6.2 DealingwithMisinformation .............................. 212
10.7 ConcludingRemarks................................................. 213
References.................................................................... 214