Research on Local Government Governance and Enterprise Social Responsibility Behaviors under the Perspective of Cournot Duopoly Competition: Analyzing Taxi Companies and Online Car-Hailing Service Companies

Abstract

Clarifying the rational choice strategy of local governments and enterprises is crucial for promoting control on the failure of taxis and online car-hailing service companies to fulfill their social responsibilities. The local government can reduce the negative externalities and irresponsibility of such companies by improving the regulatory system; thus, it is important to build a governance model that bridges tradition and modernity. This paper, on the basis of summarizing the achievements of the predecessors, builds a mixed dynamic game model among the local government, online car-hailing service companies, and taxi companies; analyzes the relationship between local government preference, execution, and governance of irresponsible enterprise behaviors; and analyzes the equilibrium solution between local government and duopoly enterprises behavior game deeply. The results show that the key to governance irresponsible companies is to make the punishment cost higher than the cost savings for irresponsible behaviors; no matter what the preference of the local government no-governance of online car-hailing service companies' irresponsible behaviors may persist; and local government ambivalence when regulating irresponsible companies is derived from the complex relationship between social benefits and company interests. Finally, through the analysis of the equilibrium results for the above model, this paper provides suggestions on regulatory policies so as to provide theoretical support and a decision-making basis for establishing scientific, universal, and feasible governance policies and offering responsible methods of urban transportation.