Do Ridesharing Services Affect the Congestion of Urban Transportation?
Dr. Sarah Estelle, Economics
With rapid advancement in smartphone usage has come the exponential growth of ridesharing applications such as Uber and Lyft. These applications offer an alternative to the taxi industry, which in most cities is highly regulated. While taxi services are restricted in the prices they can charge and the number of vehicles they operate, ridesharing services need not apply for this strict licensing. Using the technology of a smartphone application, Uber’s system of matching drivers and passengers offers an innovative way to hail a ride, with Uber claiming to complete over one million trips per day in the United States, potentially simplifying the process. Furthermore, as rapid urbanization has increased the population density of many U.S. urban areas, cities are pressured to rework their transportation networks to supply the increasing demand for public transportation, a gap ridesharing services have potential to fill. While ridesharing services offer a supplement to the transportation market including taxis, buses, personal cars, and light rail systems, an argument prevails that ridesharing services have increased traffic congestion in major cities. This research examines traffic trends in 100 U.S. cities after the implementation of Uber, which represents a majority of the ridesharing market, and the effect of Uber on road congestion. Using a fixed-effects regression model, I conclude that ridesharing services are associated with increases traffic congestion, but this result is sensitive to the inclusion of city and year fixed effects.
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