Rethinking Taxi Regulations: The Case for Fundamental Reform

by Sean Riley

By Michael Farren, Christopher Koopman, and Matthew Mitchell. From the Mercantus Center. 

New technology can disrupt an industry, vastly improving consumer welfare. It can also disrupt policy, vastly improving governance. The advent of “ride-sharing” platforms like Uber and Lyft has prompted regulators everywhere to rethink their approach to the vehicle-for-hire industry. When these technologies first appeared, many local regulators moved either to outlaw them or to achieve parity with taxicabs by regulating these new firms up to the same burdensome level as taxis. More recently, however, policymakers are taking a new approach; they are achieving regulatory parity between ridesharing platforms and taxis by deregulating taxis. Using the District of Columbia as a case study, we assess the current state of affairs in taxi regulation and suggest principles for reform. With the Department of For-Hire Vehicles currently contemplating the creation of a new “Xclass” service, we argue that now is an opportune time for fundamental reform of the entire regulatory regime in order to create a fair, open, and competitive transportation market.  [MORE]