Panel Paper: Does the Disruption of Uber/Lyft Ride-Sharing Services Impact Users’ Vehicle Acquisitions?

Friday, July 20, 2018
Building 3, Room 212 (ITAM)

*Names in bold indicate Presenter

Tayo Fabusuyi1, Robert Hampshire1, Chris Simek2, Xi Chen1 and Sharon Di3, (1)University of Michigan, (2)Texas A&M University, (3)Columbia University

Following the defeat of a proposition that would have allowed transportation network companies (TNCs) to continue using their own background check systems, Uber and Lyft suspended services in Austin indefinitely. The development provided a natural experiment to examine the impact of the suspension on users' vehicle acquisitions. We conducted an online survey administered to 1,840 Uber/Lyft users in Austin and subsequently ran regression analyses to test our hypothesis of the impact of the service suspension on vehicle acquisition. Our findings revealed that a higher than expected number of respondents (8.9%) reported purchasing a vehicle in response to the disruption – a finding that buttress the viewpoint expressed in earlier research that TNCs reduce car ownership. The probability of acquiring an automobile was most pronounced among the cohorts of respondents who report being extremely satisfied with Uber/Lyft services – on average, the odds of acquiring an automobile for this segment of respondents was more than five times that of an individual who reported not been extremely satisfied with Uber/Lyft services. Our analysis also showed that being rich exerted a contradictory effect on vehicle acquisition given the 0.51 odds ratio, an indication that richer households have a lower probability of buying a vehicle relative to the excluded group - households making less than $100,000/year.