The Impact of Supply and Demand Heterogeneity on Queue Configurations at Passenger–Taxi Stations: Pooled, Dedicated, and Hybrid

ABSTRACT This paper examines the impact of supply and demand heterogeneity on queue configurations in service systems such as passenger‐taxi stations at transportation hubs. There exist two types of passengers (short‐haul and long‐haul) and two types of drivers (short‐haul and long‐haul). Long‐haul passengers offer a larger reward for drivers, and long‐haul drivers incur a larger opportunity cost for traveling to the station. Using a queueing‐game theoretical framework, we analyze the equilibrium joining behaviors of long‐haul and short‐haul drivers and compare system performance across three queue configurations: pooled, dedicated, and hybrid systems. Our results reveal that when the rewards for serving a long‐haul passenger and a short‐haul one are both at relatively intermediate values, the dedicated system can outperform the pooled one in terms of overall boarding rate. However, the improved overall boarding rate in the dedicated system sometimes comes at the expense of a lower boarding rate for either short‐haul or long‐haul passengers. We find that the hybrid system can serve as an economically viable remedy to the dedicated system by achieving a Pareto improvement, that is, improving the overall and short‐haul boarding rates without compromising the long‐haul boarding rate while also generating additional revenue sufficient to offset the subsidy cost. Furthermore, we propose a novel modified hybrid system that can potentially improve the overall, long‐haul, and short‐haul boarding rates simultaneously.