Sharing the air: Transient impacts of ride-hailing introduction on pollution in China

The benefits and problems of sharing economy models have been debated heatedly in the literature. In this paper we investigate the introduction of ride-hailing services on pollution in the largest developing economy in the world, China. We use a difference-in-difference approach to longitudinally examine cities that introduced the Didi Chuxing service. Our results suggest that the announcement of the ride-hailing service led to a decrease in PM2.5 pollution in the month before service launch and in the early months of its introduction. However, this effect is temporary, as the growth in ride-hailing vehicles and a rapid increase in the number of overall trips gives way to an increase in vehicle pollution in this underdeveloped market. We conclude with implications of the research.