Benefits and Pitfalls of Deregulating Taxi Markets: Can Contrasted Case Studies Help Inform the Debate?

Abstract

Taxi and for-hire markets have traditionally been heavily regulated and public policymakers have been quite imaginative in regulating these markets, discriminating among market segments (hail, rank, and pre-booked), using different types of instruments (quantitative, qualitative, economic), and targeting different subjects (company, driver, vehicle). Cities and countries have experimented with the deregulation of taxi and for-hire services since the 1970s, aiming at raising the efficiency and competition in the service supply, lowering the prices, or both. Analyses of deregulated markets have often focused on the broad effects of deregulation at national level and paid limited attention to comparisons between regulated and deregulated markets. This paper discusses the effects of taxi deregulation in Stockholm (in relation to market size and structure, as well as pricing of services) in light of two contrasted case studies of regulated taxi markets in Helsinki (Finland) and Lyon (France). Original findings include observations as to some counterintuitive effects of deregulation, including high prices in both absolute (i.e., for the local context) and relative terms (i.e., compared with other cities).

Taxi Regulation and Its Impact on User Experience in European Countries

“…The quality concerns mainly focus on the qualifications of the driver and the physical and mechanical requirements of the vehicle (Barrett, 2003;Bekken, 2007;Bouteil et al, 2019;Cairns & Liston-Heyes, 1996). Barrett (2003) notes that governmental officials are required to regulate the market to make sure that the quality of service remains at a desirably high level.…”

“…Of the arguments against regulation, the most popular arguments relate to the functioning of the market. These include increasing the supply of taxis, innovation in the taxi industry as well as market efficiency (Harding et al, 2016;Bouteil et al, 2019). All the reasons pertain to increased competition.…”

“…This, in turn, would lead to markets efficiently finding themselves in a position where quality improves while costs decrease. Bouteil et al (2019) bring up new entrants into the market as an anti-monopoly deregulatory method due to increased competition. Bekken (2007) also notes that regulations mainly protect incumbent drivers from competition.…”

Taxi Transport Safety Requires System Solutions

“…Вопросам качества и безопасности услуг по перевозке пассажиров легковых такси посвящен ряд зарубежных исследований [13,14,15,16,17,18,19,20,21,22,23,24,25,26,27,28]. В большинстве своем в работах проведена оценка психофизиологических показателей водителя на аварийность.…”

“…В большинстве своем в работах проведена оценка психофизиологических показателей водителя на аварийность. Работы [18,22,14] посвящены оценке влияния дерегулирования рынка таксомоторных перевозок на безопасность. Работы [23,24,25,26,27,28] посвящены вопросам оценки качества услуг такси.…”