Traditional Taxi and Online Car-Hailing Drivers’ Operating Strategies Dynamic During COVID-19 – from a Perspective of Evolutionary Game Theory

Car-hailing and taxis coexist and constitute a healthy market in normal times when demands are sufficient for growing supplies. However, in a limited market influenced by interrupting issues such as COVID-19, drivers from online car-hailing and local taxi operators have to compete with each other for the shrinking incomes. Based on a local case study covering a 3-year continuous time duration, it is found that taxi and car-hailing drivers both lost money in the strike of COVID-19 in early 2020. A growing proportion of them chose not to operate until the pandemic peak was gone. As two groups of drivers hold different occupational characteristics, they share different operating strategies. This research proposed a static taxi and online car-hailing drivers’ operating strategies dynamic during COVID-19 from a perspective of evolutionary game theory. An optimized dynamic income incentive could be introduced to overcome this non-ideal situation. Evolutionary stable strategy show that it is highly likely to lead to a “winner-takes-all” market. Initial incomes for both drivers’ groups when they both participate should increase so that ESS (1,1) could be reached.