The government then deregulates licensing and issued lots of licences and that grey market collapsed.
Of course some saw it coming and lumped some other less clear sighted chap with the problem.
More here: https://www.google.ie/url?sa=t&source=web&rct=j&url=https://...
People would take the taxi way more if it was cheaper, thus buying less cars and polluting less. This is especially true in Paris where a ride to the airport is 70€ ! unbelievable (Uber is 50€).
If a medallion owner is happy driving 10 hours a day, but a potential owner would be happy driving 12 hours a day, the current owner should sell to the more eager driver and supply of rides will increase. If the owner cannot sell, then supply of rides is stuck at a lower level.
If the number of medallions in circulation is constant, the market price of a medallion is not a causal factor in the cost of a ride. The causality goes the other way around.
Many proponents of cap-and-trade schemes disagree.
As the parent notes, in certain setups (like cap and trade) the tradeability of the license is important for ensuring that the restricted resource is used efficiently: the most economical emitters of carbon get the rights, and the most economical drivers get the medallions.
The whole point of this is to ensure that the price for taxi rides is higher than what the market-clearing price would be. In other words, it's a scam to rip off gthe consumer.
(Similar arguments apply to zoning regulations and house prices, of course)
You might as well dismiss all cap-and-trade proposals as being "just another scheme to raise energy prices".
But there's no direct reason to limit the number of taxis. People suggest that limiting the supply ensures drivers make a decent living, but if you want that, employment law (e.g. enforcing minimum wage for drivers) is a more direct solution.
Again, if we want to limit these things, we should make laws about them directly, rather than arbitrarily limiting one of their causes. Solutions to negative externalities should be primarily based on internalising those externalities, so the market has an incentive to seek alternatives.
What happens if someone invents a more expensive, but quiet and non-polluting taxi? (Which of course, they have.) If you limit the number of taxis, everyone uses the cheaper ones to maximise profit, and you still get some noise and pollution. Whereas if you tax the noise and pollution and it becomes cheaper to buy electric taxis, you've eliminated the noise and pollution entirely.
A license shouldn't be sold. I cannot sell my driving license.
The taxicab medallion licenses are separate: they are not a license to drive a taxi, they are a license to operate one.
The licenses relating to peoples' competence cannot be sold, but the ones relating to operating a taxi can be.
If there's no regulatory requirements, then license is basically just an access fee to gain entry to a market artificially closed off by the government. It's just cronyism. What is the benefit to the public if the license is not providing some assurance of suitability of the license-holder?
if the purpose of a license is to verify that a particular person
or business entity has satisfied some regulatory requirements
In some instances it's simply a tax on an activity (UK TV license, UK road fund license).
In some instances, it's to manage a resource (fishing quotas).
then license is basically just an access fee to gain entry to
a market artificially closed off by the government.
I wouldn't argue that it's correct to apply that thinking to the medallion system - after all, I'm not sure the NYC population is going to be 'fished out' by an oversupply of taxis - and if it's to ensure a floor on taxi income so that the taxis meet a certain quality, then there are better ways (e.g. regulation) to do that.
I don't see that the sale of medallion licenses is an issue per-se, but that critiques of license-sales are essentially critiques of the medallion system itself.