Incentivizing Competition: How Utilization-Based Incentive Programs Reshape Driver Labor Allocation Behavior and Platform Competition

• In Event: LOGISTICS and TRANSPORTATION MANAGEMENT: Last Mile Delivery: Innovations and Challenges

Abstract

In response to social protests, a Southeast Asian TNC launched a personnel on-road insurance policy to improve driver utilization. This study focuses on the competitor platform to examine spillover effects of that policy using 20 weeks of data covering over 75 million trips. By identifying multi-homing and dedicated drivers through license plate matching, we find that PI implementation on the focal platform significantly altered labor patterns on the competitor platform—multi-homing drivers increased food delivery hours while dedicated drivers shifted to ride-hailing. These shifts impacted earnings and utilization, revealing how platform policies can influence labor dynamics beyond their own ecosystem.

Authors

• Sukrit Pal, Iowa State University

• Thu Trang Hoang, University of Texas Arlington