Taxi Driver Learns Dynamic Spatial Equilibrium

Abstract

I use three equilibrium concepts in the sciences to study the dynamics of taxi transportation. At the microscopic level, I formalized taxi drivers’ decision-making as an income-maximizing optimization, which collectively establishes an economic equilibrium. I solved the game theoretic equilibrium of multi-market oligopoly, which includes the taxi industry as a special case. For a macroscopic interpretation of the equilibrium outcome, I use thermodynamic equilibrium where aggregate behavior is perceived as transport phenomenon built up from individual choices. This work thus provides a microeconomic origin of urban-scale dynamics, harmonizing social and physical sciences.

Date

Dynamic equilibrium of taxi transportation.

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Ruda Zhang
Postdoctoral Fellow