Topic: Making the Most of Your Regret: Workers' Relocation Decisions on an On-Demand Platforms

Speaker: Zhongzhong Jiang 

Location: Room 306, Glorious Sun Building, Yan'an Road Campus

Time: 2020-11-02 10:00:00

Brief introduction of the speaker: Zhongzhong Jiang is the Dean of College of Business Administration, Professor(accelerated promotion) and Doctoral Director of Northeastern University, selected as one of the top young talents in the National Ten Thousand Plan, and the Director of the Institute of Behavioral and Service Operations Management. He was a visiting professor at the University of Minnesota Twin City, and a key member of the innovative research groups and major international collaborative projects of the National Natural Science Foundation of China. He is also an associate editor of International Journal of Engineering Business Management, executive director of Stochastic Service and Operations Management Branch and Behavioral Operations and Management Branch of the Operations Research Society of China, executive director of Service Science and Operations Management Branch of the Chinese Society of Optimization, Overall Planning and Economic Mathematics, director of the Society of Management Science and Engineering of China, a service-oriented manufacturing specialist of the Liaoning Provincial Industry and Informatization Department, etc. In recent years, he has undertaken a number of projects of the National Natural Science Foundation of China, in the fields of e-commerce and sharing economy, behavioral operation and revenue management, logistics and supply chain optimization, service operation and service-oriented manufacturing, etc. He has published more than 60 papers in top and important academic journals at home and abroad, such as MSOM, NRL, TRB, EJOR, Journal of Management Sciences in China, etc. He has received 12 provincial and ministerial awards for outstanding achievements and the approval of provincial and ministerial leaders. He has received 12 provincial and ministerial awards for outstanding achievements and two provincial and ministerial leadership instructions. He has been awarded honors including the Liaoning Youth Science and Technology Award, the first batch of young top talents of Liaoning Province Xingliao Talent Plan, the hundred-level talents of Liaoning Province Hundred Million Talents Project, the outstanding young scholars of Universities in Liaoning Province , the high-level leading talents of Shenyang City, the Young Post Leader in Shenyang City etc.

Report Overview: We have witnessed a rapid rise of on-demand platforms, such as Uber, in the past few years. While these platforms allow workers to choose their own working hours, they have limited leverage in maintaining availability of workers within a region. As such, platforms often implement various policies, including offering financial incentives and / or communicating customer demand to workers in order to direct more workers to regions with shortage in supply. This research examines how behavioral biases such as regret aversion may influence workers’ relocation decisions and ultimately the system performance. A combination of behavioral modeling and controlled lab experiments is used in this study. We develop analytical models that incorporate regret aversion to produce the oretical predictions, which are then tested and verified via a series of controlled lab experiments. Results show that regret aversion plays an important role in workers’ relocation decisions. Regret averse workers are more willing to relocate to the supply-shortage zone than rational workers. This increased relocation behavior, however, is not sufficient to translate to a better system performance. Platform interventions, such as demand information sharing and dynamic wage bonus, can help further improve the system. We find that workers’ regret-aversion behavior may lead to an increased profit for the platform, a higher surplus for the workers, and an improved demand-supply matching efficiency, thus benefiting the entire on-demand system.