Dispatching Model in Online Taxi System by Using Stable Marriage and First Price Sealed Bid Auction Models

Abstract

Dispatching system plays a crucial role in today smartphone based online taxi system. There are three common models that are used in online taxi dispatch system: (1) first come first served, (2) stable marriage, and (3) agent-based models. Unfortunately, these existing models accommodate passenger's waiting time and/or driver's pickup cost only. Meanwhile, there are several other important aspects: price, driver's service level, and passenger's behaviour. Based on this problem, this work aims to develop a dispatching model for online taxi system that accommodates these aspects too rather than waiting time and pickup cost only. This model is developed by combining stable marriage and first price sealed bid auction. The stable marriage is used to satisfy both passenger and driver. The first price sealed bid auction is used to offer a competitive price for the passenger that is still accepted by the driver. Based on the simulation result, overall, the proposed model performs the best among the previous models, except in the average pickup distance. In the extreme undersupply condition, the proposed model creates 20 percent higher in the average customer's satisfaction score and equal in the average net distance. In the extreme oversupply condition, the proposed model creates 28 percent higher in the vehicle's satisfaction score. The proposed model creates up to 21 percent lower travel cost. Although the proposed model creates the worst in the average pickup distance, the average pickup time is 3.9 minutes with the assumption that the vehicle's speed is 10 km per hour.