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The Tyranny of Taxi Medallions

blog.priceonomics.com

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Re: The Tyranny of Taxi Medallions

#11

Post by dominicmauro »

dantheman wrote: post #5
tptacek wrote: post #4

Apart from all the obvious externalities of cab driving operations, the extremely high probability of fraud, and the fact that policing cabs is extraordinarily expensive, there's another problem a lot of these analyses miss about why cabs are regulated the way they are. In many large cities, the taxi system is a fundamental component of the transport infrastructure. There are locations in most cities that are not eff…

I don't know what taxis you ride in, but i routinely ride in medallion taxis that either use GPS or their iphone to figure out where to go. I've also had some claim that they're at the destination until I pull out my phone and point to them on the map where to go. If you want to regulate taxis, you can still do that - but there is no reason to limit the supply of taxis.

The guy you're replying to just gave you a reason to limit the supply of taxis: regulating them is expensive.

Re: The Tyranny of Taxi Medallions

#13

Post by dsr_ »

tptacek wrote: post #4

Apart from all the obvious externalities of cab driving operations, the extremely high probability of fraud, and the fact that policing cabs is extraordinarily expensive, there's another problem a lot of these analyses miss about why cabs are regulated the way they are. In many large cities, the taxi system is a fundamental component of the transport infrastructure. There are locations in most cities that are not eff…

Then any system which fulfills the following criteria should work:

- good (safe, knowledgeable, rested) taxi drivers - taxis in good condition - a sufficient number of taxis on the road - a reasonable price to the customer - and a system to handle complaints

It seems to me that medallions actually fail on some of these points. Instead, it would be worthwhile to:

- license drivers, not medallions. Non-transferable right to operate. - license taxis with regular inspections - use technology to track cabs - have the city run a centralized, mostly web-and-touchtone based dispatch system - and adopt suitable regulations to avoid feast-or-famine at the airport, downtown, and that socio-economic region that the cabs tend to avoid

Re: The Tyranny of Taxi Medallions

#14

Post by onemorepassword »

There is a flipside however, for those who think deregulation is the answer.

In Amsterdam, the taxi market has been completely deregulated. You do not want to get a taxi there unless you order it from a trusted source, and even then it's ridiculously expensive.

And you don't want to try to disrupt that market unless you have good organized crime connections...

Re: The Tyranny of Taxi Medallions

#15

Post by aetherson »

tptacek wrote: post #4

Apart from all the obvious externalities of cab driving operations, the extremely high probability of fraud, and the fact that policing cabs is extraordinarily expensive, there's another problem a lot of these analyses miss about why cabs are regulated the way they are. In many large cities, the taxi system is a fundamental component of the transport infrastructure. There are locations in most cities that are not eff…

None of these things are reasons for a limited number of medallions.

To be clear: a medallion system says, "In San Francisco, we will have 680 cabs, no more."

That is separate from the question of whether you license cab drivers or charge for the license.

You could say, "In order to drive a cab in this city, you must pass an area knowledge test, pass a more-onerous driving test, you must re-pass these tests every two years, and we will revoke your license if you're involved in an accident. And in order to defray the costs of administering this program, we will charge you $1,000 for that license. And you must use this pricing scheme for fares." But if you were willing to license every person who passes those tests and pays that fee, without regard for how many people have already passed the tests and paid the fee, you aren't operating a traditional medallion system.

Re: The Tyranny of Taxi Medallions

#16

Post by aetherson »

dominicmauro wrote: post #11
dantheman wrote: post #5

Earlier quoted context omitted.

I don't know what taxis you ride in, but i routinely ride in medallion taxis that either use GPS or their iphone to figure out where to go. I've also had some claim that they're at the destination until I pull out my phone and point to them on the map where to go. If you want to regulate taxis, you can still do that - but there is no reason to limit the supply of taxis.

The guy you're replying to just gave you a reason to limit the supply of taxis: regulating them is expensive.

That's not a reason to limit the supply of taxis. That's a reason to charge a fee for a taxi license that defrays the cost of regulating them.

Re: The Tyranny of Taxi Medallions

#17

Post by johnrob »

ajju wrote: post #6
tptacek wrote: post #4

Apart from all the obvious externalities of cab driving operations, the extremely high probability of fraud, and the fact that policing cabs is extraordinarily expensive, there's another problem a lot of these analyses miss about why cabs are regulated the way they are. In many large cities, the taxi system is a fundamental component of the transport infrastructure. There are locations in most cities that are not eff…

As the other commenter pointed out, the problem is primarily with the supply limit on taxis. Not limiting the supply of cabs artificially would result in more supply for whoever needs a ride, arguably lower the cost of a ride and help with more revenue for policing. Making sure that taxis pick up in poor neighborhoods is an important, tough, and long standing problem. It would be disingenuous to argue that the "marke…

Traffic is something to consider - that might be one reason a customer would want to limit taxis.

Re: The Tyranny of Taxi Medallions

#18

Post by jameshsi »

onemorepassword wrote: post #14

There is a flipside however, for those who think deregulation is the answer. In Amsterdam, the taxi market has been completely deregulated. You do not want to get a taxi there unless you order it from a trusted source, and even then it's ridiculously expensive. And you don't want to try to disrupt that market unless you have good organized crime connections...

yeah, i'd be interested in comparisons of urban transportation across the globe. beyond taxis, an analysis with comparisons like underground use vs. taxi etc would be a great follow up to this article.

Re: The Tyranny of Taxi Medallions

#19

Post by gertef »

NoPiece wrote: post #9
tptacek wrote: post #4

Apart from all the obvious externalities of cab driving operations, the extremely high probability of fraud, and the fact that policing cabs is extraordinarily expensive, there's another problem a lot of these analyses miss about why cabs are regulated the way they are. In many large cities, the taxi system is a fundamental component of the transport infrastructure. There are locations in most cities that are not eff…

What you are saying is fine, but that's not why taxi's were regulated, at least in New York. The regulations go back to the depression and were put in place specifically to limit competition in order to keep prices high and protect employment of existing cab drivers. The history is right on the NYC gov page: http://www.nyc.gov/html/media/totweb/taxioftomorrow_history_... -- quoting from the NYC site: "Widespread pove…

As you wrote: "The situation was made worse by the tactics of “wildcat” (unlicensed) taxis who used what some considered to be “underhanded tactics,” such as drastically lowering fares, to get more business."

Protecting a critical industry from market failure is more than just "protecting employment"

Re: The Tyranny of Taxi Medallions

#20

Post by gertef »

yummyfajitas wrote: post #10
tptacek wrote: post #4

Apart from all the obvious externalities of cab driving operations, the extremely high probability of fraud, and the fact that policing cabs is extraordinarily expensive, there's another problem a lot of these analyses miss about why cabs are regulated the way they are. In many large cities, the taxi system is a fundamental component of the transport infrastructure. There are locations in most cities that are not eff…

Policing cabs is vastly cheaper than the cost of a medallion. https://news.ycombinator.com/item?id=1650659 Cities therefore have a powerful interest in making sure that whatever else happens, there is a strata of taxi service available to all residents of the city at some predictable rate. Limiting the supply of taxes reduces the likelihood that this will occur. Not that NY has anything like the "universal service" y…

Taxis are required to service all destinations in manhattan.

But yeah, originations are a problem.

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