THEORETICAL ANALYSIS ABOUT MARKET STRUCTURE OF CAR SHARING SERVICE WITH TRANSACTION COST

Abstract

In car sharing service market, which is now widely spread in the society, service providers allocate cars in service spots and users visit spots in order to enjoy the service. In such a service market, positive feedback mechanism functions thanks to the scale economy through the decrease in transaction cost; i.e.,the more users visit a market, suppliers provide more service to the market, and vice versa. In this paper, an equilibrium model to show the characteristics of car sharing market is presented to investigate agglomeration mechanisms and the possibility of multiple market equilibria. In addition, effects of change in market circumstances on the equilibrium is investigated.