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Comment by spindritf | Hacker News Reader

Presumably, the taxi industry is "heavily regulated" for the benefit of the customer, then shouldn't customers flock to this excellent, regulated service on their own? Why are those artificial and arbitrary limits necessary?

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In some Italian cities the situation is no different: taxi licenses are issued only on a fixed, limited number and are sometimes inherited from father to child, often sold for mind-boggling amounts (comparable to the price of a house). The service as a result is quite crap: long waits, high prices per km and all the most contrived surcharges you can think of (5 additional Euros for the airport and some tourist destinations, etc). Each time a deregulation is proposed (and it does happen) there are immense backlashes from a small category that would be not only stripped of a privilege, but actually, properly ruined: some cabbies have to take 10 yrs mortgages to buy a license. It's a legacy state of affairs that carries on only because it's difficult to remove, not because it's of actual advantage to anyone.

> high prices per km

In Italy, and in other European countries, the taxi prices are set by the city councils, not the taxi drivers.

And those councils are aggressively lobbied (and possibly bribed) by those taxi drivers.

The most depressing thing about public corruption is how cheap it is.

The same basic situation exists in New York City. They're called taxi medallions there, and the small supply and large demand causes them to cost a surprisingly large amount of money. The government even has a convenient graph of the average price over time:

http://www.nyc.gov/html/tlc/downloads/pdf/price_trends_chart...

That shows a cost of 359,000 in 2006. More recent data is even crazier:

http://www.nyc.gov/html/tlc/downloads/pdf/avg_med_price_2013...

According to that, they cost a million dollars apiece these days.

The last time I went to Brasserie Flo after a concert at New Morning I waited 90 minutes at a taxi stand for cabs behind a 50-foot line of other late-night revelers. Cabs came 10 minutes apart. I have never waited so long for a cab in a major city.

The industry may be heavily regulated, but it does not seem to be rigged in favor of the customer.

If I knew I would get a ride in 15 minutes, I would snap at this in every city I travel to.

Not necessarily, not if some companies are committing fraud, or creating a monopoly.

The entire point of rational regulation (not to be confused with insane regulation, which is sadly common) is to avoid market failures such as the tragedy of the commons. By their very nature, those market failures mean that a regulated industry cannot compete with an unregulated one, but people are still better off with the regulated one.

That's not to say that these regulations are beneficial or that regulations are needed at all here (I have no idea either way), merely that you can't judge the utility of regulations by letting them compete with deregulated industry and seeing which one wins.

> a regulated industry cannot compete with an unregulated one, but people are still better off with the regulated one.

Can you please give one example?

http://en.wikipedia.org/wiki/Tragedy_of_the_commons#Applicat...

Probably the clearest example: If one company is required to clean up its waste responsibly and the other one is allowed to do whatever it wants with its waste, the unregulated company will destroy the other one (perhaps literally by burying it under a mountain of waste).

> to clean up its waste responsibly

Why won't the unregulated company get sued if they dump their waste onto someone else's property (in/directly)?

Because that "someone else's property" is often shared water/air resources, and when you cause $30 million in damages by causing 10 cents in damage each to 300 million people, there's no way to turn that into a lawsuit, even when tons of other people are doing the same thing and adding up to thousands of dollars of damage per person.

That's precisely the tragedy of the commons - there is no "someone else" when it comes to things like water and air pollution, so without government regulation, there is no incentive to protect the commons, only use it in a manner to maximally improve one's own economic self interest, in a manner that harms all in an aggregate manner more than the community has been benefited.

It's a net-loss without some form of government regulation.

It's only a market failure, because it's publicly owned. Oceans and air is tricky, but rivers and lakes can certainly be privately owned.

But, regulation is also a public good and therefore also a market failure... so you end up with regulations that harm 99% of the people, like in the case of Uber in France.

For someone asking for evidence earlier, it's odd that you so like to toss around '99' like it's a factual number.

It's not a literal statement. Customers lose and taxi companies benefit. 99%/1%.

This really gets tiresome. Somebody states something pretty obvious, like the fact that the massive environmental harm of leaded gasoline outweighed the minor benefit to drivers, and you're right there asking for evidence without doing any work yourself. But when you make a much more precise and much less obvious claim about a specific set of regulations harming 99% of people, then "it's not a literal statement" and we should, apparently, not even think about asking you to back it up.

Anyone who works with demographics in a serious manner is aware that a 99% split is extraordinarily difficult to achieve.

You're actually saying that the regulations on Uber hurt 99% of the people of France. Children? The mentally ill? Prisoners? Soldiers stationed overseas? Farmers? People too poor to afford taxis in the first place?

Hell, people outside the Uber areas of service, which is apparently just Paris?

Each of these demographic segments pretty much wholly have no interest in something like Uber, and slice off percentage point after percentage point. And even when you take your twenty/thirty/fortysomething urban parisian with the money for car hire, plenty have life patterns that don't need a taxi or uber - they walk or cycle or bus or train it about.

'99%' is utter, utter tosh, both in the literal, and more importantly, in the contextual figurative sense it was given.

Pollution regulations are an obvious example. Car emission regulations seem to be a pretty good thing, what with the distinct lack of smog in major US cities these days. Yet, if given the choice to opt in or opt out of the regulations, people would generally opt out, as it's cheaper for them personally. The result would be the return of car-related smog.

Car regulations are a great thing, and pollution levels have decreased a lot, even in LA.

Pollution is still a significant problem in LA.

> “Ozone and particle pollution contribute to thousands of hospitalizations, emergency room visits, and deaths every year,” Dr. Kari Nadeau, a Stanford Medical School professor and American Lung Association researcher, said when the State of the Air report was released. “Air pollution can stunt the lung development of children, and cause health emergencies, especially for people suffering from chronic lung disease, including asthma, chronic bronchitis, and emphysema. Both long-term and short-term exposures can result in serious health impacts.”

http://www.forbes.com/sites/eco-nomics/2012/08/23/los-angele...

The numbers of people dying from car pollution is weirdly high, considering we don't hear much about it.

Leaded gasoline. Using it allows you to increase the compression of your engine, which improves fuel economy.

The total cost of lead in the environment by far outweighs the economic benefits, which is why it's banned, yet for each individual person it makes economic sense to use leaded gasoline if you can.

Nice one! This is a much better example than my more generalized one of car emissions in general.

> The total cost of lead in the environment by far outweighs the economic benefits

Evidence?

Putting extra lead in the environment increases the risk of people coming into contact with larger amounts of lead. Lead has been shown to cause health problems and birth defects.

Literally 3 seconds on Google for "lead cost benefit analysis" yields this 1985 study by the EPA: http://yosemite.epa.gov/ee/epa/eerm.nsf/vwAN/EE-0034-1.pdf/$...

It's even worse than that, I think. I may have missed it since I just skimmed that document, but I don't think it covered violent crime.

It has been shown rather conclusively that overexposure to lead in childhood leads to an increase in violent crime in adulthood. Banning leaded gasoline was the single most significant cause of the large decrease in violent crime in the US in the latter part of the 20th century. Here's one story on this [1]. Cites to peer reviewed journals are available from Wikipedia [2].

[1] http://www.independent.co.uk/environment/green-living/ban-on...

[2] http://en.wikipedia.org/wiki/Tetraethyllead#Toxicity

Regulation must exist for valid reasons (clear evidence of environmental harm exists for lead emissions) and be applied equally. Neither of those is true here.

We aren't actually discussing taxi regulations in this subthread, just regulations in general, and why you can't judge their merit by letting them compete in a free market.

The libertarian argument here would be "burning leaded gas is a tort against everyone else breathing the air", right? You clearly have to special case it because the harm is so diffuse; you could presumably either have a government ban it, or have some objective standard where non-compliance is itself taken as a tort, and then something like class-action. There's the California option -- Prop 65 has this weird way for private people to find violations and be paid for them, although the enforcement action is taken by the state.

I can't see "someone with a $0.0001 harm files suit against the aggressor" x 7b being a scalable solution without some kind of optimization. Maybe you could imagine some kind of little automated lawyer-agent which sues behind on your behalf, with everything happening at a micro-transaction level, but that seems kind of silly.

Regulation is a public good, therefore it is itself a market failure. Voters don't do hours of research to determine what constitutes rational regulation.

So, if there's a new law that will cost 990 people $1 each and the other 10 people gain 99 each... it will pass, because for 99% of the people it's not even worth an hour of their time to rally against it. However, the 1% that benefit from it can afford to organize entire campaigns to convince the 99% that this new law is for their own good.

It certainly can be. Lots of laws are built to favor small groups who benefit less than the total cost imposed on the rest of the country.

My point is simply that regulation can be overall good and that you can't detect this by having them compete, because even good regulation can't compete.

>the taxi industry is "heavily regulated" for the benefit of the customer

I get your point, but people decry the regulation that Uber is fighting against...until Uber implements free market "surge pricing". Then people are more than happy to leap back into the yellow cabs, which have their price regulated. Just read through some of the fallout.

In other words, all the free market vs regulation talk is lip service. People want what's best for themselves.

until Uber implements free market "surge pricing". Then people are more than happy to leap back into the yellow cabs, which have their price regulated

That is assuming they can find one. Surge pricing incentivizes drivers to actually show up and compensates them for tougher conditions and additional risk.

Do you have any numbers or stories showing that extra drivers begin working when surge pricing comes into effect at uber?

>Surge pricing incentivizes drivers to actually show up and compensates them for tougher conditions and additional risk.

I get it, and I believe it's well within their right, and also an interesting strategy. I'm not really knocking Uber, I'm knocking some of its supporters.

Again, read through some of the comments on mainstream articles regarding the surge price kerfuffle. Filled with people saying, "Suck it Uber and your dynamic pricing! I took a regular taxi!" Meaning, they'll support the unregulated market, as long as it's cheaper.

People want more de-regulation, but fail to see the seemingly "good" that comes from regulation; in this case, predictable pricing when you're trying to get somewhere.

"BART drivers earn six figures. Why do they even need a union?"

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