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The Tyranny of Taxi Medallions

blog.priceonomics.com

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Re: The Tyranny of Taxi Medallions

#81

Post by auctiontheory »

johnrob wrote: post #17
ajju wrote: post #6

Earlier quoted context omitted.

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.

Increasing the number of taxis might decrease the number of cars on the street, especially in cities where public transport is not a viable option. Allowing more taxis certainly would decrease the demand for parking in already-congested central areas.

Re: The Tyranny of Taxi Medallions

#82

Post by malandrew »

This article makes one awesome point for regulation that would be beneficial: exchange of data on passengers and drivers. Even if opt-in (for privacy reasons) this would be awesome. As a customer, I would love for my reputation on Lyft to be usable on SideCar and vice versa. On top of that, I'd love to be able to call a car from both companies simultaneously and whichever company gets met a driver first wins my money.

Requesting a car needs to look more like the financial system where your broker puts out a buy order and a broker representing the driver takes that buy order.

Re: The Tyranny of Taxi Medallions

#83

Post by malandrew »

seanalltogether wrote: post #49
pg wrote: post #2

Structurally this practice is a lot like the preindustrial precursor of taxation, when governments would sell monopolies on the import or production of things in exchange for a lump sum. When obsolete government practices persist, they tend to be pretty sinister.

I've brought this up in another thread, but over in the UK, due to a lack of property taxes, its possible to purchase a home, yet stil have to pay a yearly ground rent to a private party. The cost to own land in nothing, so there's little incentive to ever sell it, and instead lease it out. People may complain about property taxes in the USA, but it prevents this very practice from happening. It would be better for e…

Property taxes make a ton of sense for buildings which are not primary residences. If you don't live on a piece of land or operate a business there then the property taxes need to be high enough to discourage ownership and should promote highest and best use.

Re: The Tyranny of Taxi Medallions

#84

Post by mech4bg »

seanalltogether wrote: post #71
mech4bg wrote: post #66

Earlier quoted context omitted.

We don't have yearly property taxes in Australia, just council rates which are usually around 0.2% of the house valuation (which is much lower than in the US AFAIK). However we don't have the split land/house purchasing like in the UK (or it's not very common at least) - I wonder why?

The UK is the type of place where every last square inch of land has been claimed and defended several times over. Australia likely has plenty of land that no one is in a hurry to claim.

The property market underwent a huge decade plus long boom in Australia, with land prices rising astronomically. There are all sorts of rules for land development in place, and limited availability for development in the major cities. It's not quite as bad as the UK, but it's not like we have huge chunks of land to spare.

I assume it's either a result of property law differences, or the sheer length of time land has been available to own in the UK. Would love to know more about it.

Re: The Tyranny of Taxi Medallions

#85

Post by malandrew »

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…

Don't forget the mandate that a certain number of taxis need to be wheelchair accessible. I'm not disabled, but I would like to see both SideCar, Lift, Uber and InstantCab offer wheelchair accessible community cars.

Re: The Tyranny of Taxi Medallions

#86

Post by potatolicious »

NoPiece wrote: post #41
potatolicious wrote: post #28

Earlier quoted context omitted.

> "who used what some considered to be “underhanded tactics,” such as drastically lowering fares, to get more business." Lower fares is not the only consequence of this type of free market. In NYC we've seen a rise of intercity buses competing at cut-rate prices, and one such bus company recently and spectacularly failed every single safety inspection performed on their vehicles. They also have an accident rate sever…

You say, "it's dishonest to pretend that regulation is strictly driven by parasitic behavior," but I was just quoting directly from the nyc.gov site that explains that's exactly why those regulations came to be. You can argue separately for safety regulations, but that's not why NY started to regulate cabs - it was protecting an existing industry from competition. Also, put yourself in the 1935 mindset - was there ev…

> "Also, put yourself in the 1935 mindset - was there even auto insurances? were there seat belts? The risk profile people lived with was much different."

Indeed, and that's precisely the start of much industry regulation. Not just taxis, but railways, boats, and all other forms of shared transport. Transportation safety was a Big Deal in the early 20th century, and the market did differentiate itself on that point - but there was also little regulation or oversight to ensure that claims of improved safety were actually real (see the most infamous example in the Titanic).

Mandated seat belts, car insurance, brake mechanisms (e.g., trains), speeds, inspections. All of these were borne out of necessity. The lack of safety in the 1935-life is why we are living with so many regulations today.

Our history seems to go: new technology, a lot of people are killed by new technology, regulation to improve safety of technology.

The "let's deregulate everything!" angle is just winding back the clock. To before the regulations became onerous and excessive, but also to before the regulations saved a lot of lives.

Re: The Tyranny of Taxi Medallions

#87

Post by codex »

Medallions exist for a very good reason: they prevent a tragedy of the commons from creating gridlock and pollution in major cities by limiting the number of cars circling around doing nothing on city streets.

Most of the time, cabs just drive around waiting for a fare. This is because cabs are often hailed when they are seen, but even if a cab is summoned by a phone call (or smartphone) the closet cab to the fare is chosen, and it's hard to get close to fares without driving around, because parking the cab downtown is expensive and slow.

So, cabs use the city's public streets as mobile parking lots, hovering close to potential fares, snarling traffic, and emitting greenhouse gasses until they snag one. Increase the number of medallions, and you have a corresponding increase in the amount of traffic in a city as cabs wander around fishing. Cab drivers don't care if they're slowing everyone else down. They just want to earn a living.

So it's better to have fewer cabs busy 100% of the time than more cabs which aren't always busy. Thus, medallions are scarce.

Recently NYC decided not to issue more medallions, because the increased availability of cabs would be more then offset by increased time to get from point A to point B due to more traffic congestion.

This is a strong argument for regulating this new breed of unlicensed cab services. They must not be permitted to loiter around in traffic hoping to be the car closest to the next fare. They must either have a medallion or be parked when not actively on a call.

Re: The Tyranny of Taxi Medallions

#88

Post by larrys »

schiffern wrote: post #70
larrys wrote: post #59

Earlier quoted context omitted.

"When obsolete government practices persist, they tend to be pretty sinister." How might you propose to compensate people who, in good faith, bought taxi medallions (a legal practice)? (Or do you feel that's not necessary?)

The article said it pretty well. > So, medallion holders speculated in holding a government asset and lost. Some of these people are also taxi drivers or operators of taxi dispatch companies. Like Greek bondholders, they gambled and lost big.

"So, medallion holders speculated"

Don't agree with that at all that is what the article says. (It doesn't match up with my definition either based on my years of business experience either.)

Definition of "speculation" from investopedia:

"The act of trading in an asset, or conducting a financial transaction, that has a significant risk of losing most or all of the initial outlay, in expectation of a substantial gain."

Based on history there is no reason to believe that the purchase of a taxi medallion could result reasonably in losing "most or all" of the initial outlay. (Unless of course you decided to buy one while ignoring the current events going on of course).

http://www.investopedia.com/terms/s/speculation.asp

Of course you can make any investment or purchase speculative depending on how much of a chance you want to take.

If you decide to get in on an up and coming area in real estate (a run down area that you hope will change over the course of many years) that could easily be seen as speculation. Otoh, buying a condo in a well established neighborhood that has a history would not be seen as speculation which is not the same as saying that you bought because you felt that the value could double and if that doesn't happen you may feel you have "lost" something (the high gain you expected).

Even in the case of eminent domain taking of property for public good the property owners are compensated somewhat fairly for the loss of value of their property. The government doesn't come along and say "hey we need this area for a road sorry guys to bad it happened to you".

I would go further to say that these medallion owners would band together and at least attempt to do whatever they could legally to find a way to prevent something like this from happening if they could. Why? There is enough money involved to pay lawyers to muck up the process or delay it (just like with eminent domain, people even if there is compensation, will do that.)

Re: The Tyranny of Taxi Medallions

#89

Post by enf »

argumentum wrote: post #79
larrys wrote: post #59

Earlier quoted context omitted.

"When obsolete government practices persist, they tend to be pretty sinister." How might you propose to compensate people who, in good faith, bought taxi medallions (a legal practice)? (Or do you feel that's not necessary?)

How might you propose to compensate people who, in good faith, bought taxi medallions I'm sure the following question was asked many times to abolitionists: How might you propose to compensate people who, in good faith, bought other people

It seems as disturbing to me as it apparently does to you, but it was recently in the news that the UK actually did a buyout when they abolished slavery. http://www.independent.co.uk/news/uk/home-news/britains-colo...

Re: The Tyranny of Taxi Medallions

#90

Post by larrys »

argumentum wrote: post #79
larrys wrote: post #59

Earlier quoted context omitted.

"When obsolete government practices persist, they tend to be pretty sinister." How might you propose to compensate people who, in good faith, bought taxi medallions (a legal practice)? (Or do you feel that's not necessary?)

How might you propose to compensate people who, in good faith, bought taxi medallions I'm sure the following question was asked many times to abolitionists: How might you propose to compensate people who, in good faith, bought other people

"How might you propose to compensate people who, in good faith, bought other people"

Seriously? You're making that comparison?

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