Does Subsidy Work? an Investigation of Post-Adoption Switching on Car-Hailing Apps

Subsidy has been consistently considered as an efficient way to attract consumers with low price, and can be measured through users' price tolerance. By focusing on car-hailing apps, this study investigates users' switching intention and continuous usage based on value-intention framework and Limayem's intention-habit-usage model under the context of lower subsidy. Price tolerance, as a perceived cost, was proved to have an effect on perceived value. From value perspective, utilitarian value, hedonic value and social value are conjointly hypothesized to affect users switch intention, while the switch intention is influenced by habit and alternative attractiveness. The relationships between switch intention and continuous usage are also investigated. Questionnaire data collected from 295 valid car-hailing apps users provide support for hypothesis validation of the research model. Discussions and implications of this study are provided.