When a few undermine the whole: a class of social dilemmas in ridesharing
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Peer-reviewed
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Abstract
We investigate a class of social dilemmas that arise when a heterogeneous group of agents potentially benefit from a joint enterprise such as ridesharing. Participation in the enterprise incurs positive externalities to other participants; social welfare is maximized with full participation. However, if some agents find it a dominant strategy to opt out, then the potential benefit from the enterprise will decrease, leading to more members opting out. This iterated disincentivizing effect could result in massive welfare losses. We construct a game-theoretical model to implement these social dilemmas and report experimental evidence for their existence and welfare impact.
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Keywords
Social dilemmas, Ridesharing, Cost-sharing, Route choice in traffic networks, Heterogeneous decision makers, Experiment
Journal Title
Journal of Economic Behavior and Organization
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Journal ISSN
0167-2681
1879-1751
1879-1751
Volume Title
166
Publisher
Elsevier BV
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Sponsorship
National Science Foundation (NSF) (via University of Nevada, Las Vegas) (15-784G-00)
NSF Grant SES-1418923