Management and Global Business Seminar - Yue Maggie Zhou

Guest speaker Yue Maggie Zhou from University of Michigan-When Uber Eats its own business, and its competitors' too: Platform diversification and cross-platform cannibalization

Diversification by a platform firm offers its complementors opportunities to share complementor resources across businesses. However, because the platform lacks ownership over these resources, the complementors may allocate them to maximize their own synergy at the cost of the platform. At the same time, the potential synergy from the diversifying platform firm may divert complementor resources away from competing platform firms. We analyze changes in the rideshare business in Manhattan after Uber launched Uber Eats in New York City. We find that the launch of Uber Eats was associated with a reduction in potential trip numbers for both Uber and Lyft. However, both effects were weakened during rush hours, when the opportunity costs of resource reallocation to Uber Eats were higher for the rideshare drivers.

If you have any further questions about the topic or speaker, please contact Tony He at Tony.He@Rutgers.edu