Farnoud Ghasemi

List of main publications and preprints

1. MoMaS: Two-sided Mobility Market Simulation Framework for Modeling Platform Growth Trajectories

   Ghasemi, Farnoud, and Kucharski, Rafal

   2024

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   Mobility platforms such as Uber and DiDi have been introduced in cities worldwide, each demonstrating varying degrees of success, employing diverse strategies, and exerting distinct impacts on urban mobility. We have observed various growth trajectories in two-sided mobility markets and understood the underlying mechanisms. However, to date, a realistic microscopic model of these markets including phenomena such as network effects has been missing. State-of-the-art methods well estimate the macroscopic equilibrium conditions in the market, but struggle to reproduce the individual human behaviour behind and complex growth patterns sensitive to platform strategy and policies. To bridge this gap, we introduce the MoMaS (two-sided Mobility Market Simulation) framework to represent growth mechanism in two-sided mobility markets based on the realistic behavior adjustment of drivers and travelers reactive to platform strategy. In the proposed framework, traveler and driver agents learn the platform utility from multiple channels: their own experience, peers’ word-of-mouth, and the platform’s marketing, all-together constituting the agent’s perceived utility of the platform. Each of these channels is modeled and updated by our S-shaped learning model day-to-day which stabilizes, and at the same time, remains sensitive to the system changes.The platform can simulate any strategy on five levers: trip fare, commission rate, discount rate, incentive rate, and marketing. MoMaS allows to reproduce a variety of market phenomena, including reluctancy, neutrality, and loyalty at the individual level, as well as critical mass, bandwagon effect, positive and negative cross-side network effects at the aggregated level, which are crucial to reproduce realistic growth trajectories.We illustrate the capabilities of MoMaS through an extensive set of real-world experiments. Our results demonstrate that once the platform acquires critical mass, it triggers a significant positive cross-side network effect, accelerating growth. However, this can be reversed if a negative cross-side network effect is triggered, leading to the collapse of the platform. MoMaS is applicable for real-sized problems and available on public repository along with reproducible experiments.

2. AAMAS

   Modelling the Rise and Fall of Two-sided Markets

   Ghasemi, Farnoud, and Kucharski, Rafal

   In Proceedings of the 23rd International Conference on Autonomous Agents and Multiagent Systems 2024

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   Two-sided markets disrupted our economies, reshaping markets as diverse as tourism (airbnb), mobility (Uber) and food deliveries (UberEats). New market leaders arose leveraging on platform-based business model, questioning well-established paradigms. The underlying processes behind their growth are non-trivial, inherently microscopic, and leverage on complex human interactions. Platforms need to reach critical mass of both supply and demand to trigger the so-called cross-sided network effects. To this end, platforms adopt a variety of strategies to first create the market, then expand it and finally successfully compete with others. Such a complex social system with many non-linear interactions and learning processes calls for a dedicated modelling approach. State-of-the-art methods well estimate the macroscopic equilibrium conditions, but struggle to reproduce the complex growth patterns and individual human behaviour behind. To bridge this gap, we propose the microscopic S-shaped learning model where agents build their perception on the new service with time, affected by both endogenous (service quality) and exogenous (marketing and word-of-mouth) factors cumulated from experiences. We illustrate it with the case of two-sided mobility platform (Uber), where the platform applies a series of marketing actions leading to rise and then fall on the market where 200 drivers serve 2000 travellers on the complex urban network of Amsterdam. Our model is the first to reproduce not only behaviourally sound, but also empirically observed growth trajectories, it remains sensitive to a variety of marketing strategies, allows reproducing the competition between platforms and is designed to be integrated with machine learning algorithms to identify the optimal market entry strategy.

3. arXiv

   Ride Acceptance Behaviour Investigation of Ride-sourcing Drivers Through Agent-based Simulation

   Ghasemi, Farnoud, Ashkrof, Peyman, and Kucharski, Rafal

   arXiv preprint arXiv:2310.05588 2023

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   Ride-sourcing platforms such as Uber and Lyft offer drivers (i.e., platform suppliers) considerable freedom of choice in multiple aspects. At the operational level, drivers can freely accept or decline trip requests that can significantly impact system performance in terms of travellers’ waiting time, drivers’ idle time and income. Despite the extensive research into the supply-side operations, the behavioural aspects, particularly drivers’ ride acceptance behaviour remains so far largely unknown. To this end, we reproduce the dynamics of a two-sided mobility platform on the road network of Delft using an agent-based simulator. Then, we implement a ride acceptance decision model enabling drivers to apply their acceptance strategies. Our findings reveal that drivers who follow the decision model, on average, earn higher income compared to drivers who randomly accept trip requests. The overall income equality between drivers with the acceptance decision is higher and travellers experience lower waiting time in this setting.

4. arXiv

   Dynamics of the Ride-Sourcing Market: A Coevolutionary Model of Competition between Two-Sided Mobility Platforms

   Ghasemi, Farnoud, Drabicki, Arkadiusz, and Kucharski, Rafał

   arXiv preprint arXiv:2310.05543 2023

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   There is a fierce competition between two-sided mobility platforms (e.g., Uber and Lyft) fueled by massive subsidies, yet the underlying dynamics and interactions between the competing plat-forms are largely unknown. These platforms rely on the cross-side network effects to grow, they need to attract agents from both sides to kick-off: travellers are needed for drivers and drivers are needed for travellers. We use our coevolutionary model featured by the S-shaped learning curves to simulate the day-to-day dynamics of the ride-sourcing market at the microscopic level. We run three scenarios to illustrate the possible equilibria in the market. Our results underline how the correlation inside the ride-sourcing nest of the agents choice set significantly affects the plat-forms’ market shares. While late entry to the market decreases the chance of platform success and possibly results in "winner-takes-all", heavy subsidies can keep the new platform in competition giving rise to "market sharing" regime.