Low Taxi Prices in Cancun

Whenever Jen & I go shopping in Cancun, I marvel that you can take a taxi to & from the supermarket here for less than the cost of a large box of cereal or a couple of loaves of bread. Imagine taking a taxi in New York or Toronto (our home town) & paying the driver with a loaf of Wonder bread. Ya, I Wonder what would happen...

Taxis in Cancun - they are everywhere!

For a while I complained about the prices of bread & cereal here (which, unlike many things, cost about the same as they do at home). Then I realized that the problem isn't the price of bread & cereal in Cancun. The problem is the price of taxis in New York & Toronto... &, indeed, in almost every large city in the developed world.

Monopoly...

It's a fun game, especially when you are one of the lucky owners of a "medallion" entitling you to drive a taxi in a city (thanks, very likely, to venal or ignorant administrators) which artificially limits their numbers. As always, prices tend to rise when demand exceeds supply...


With all due respect to the world's taxi drivers, it's not really any more dangerous or difficult than many minimum wage jobs (like working the night shift at a 7-11). And when you find yourself paying more than minimum wage for a job that thousands would kill to do for minimum wage, you start to wonder..

In my case, I wondered. Then I read this in Wikipedia:


Supporters of taxi industry de-regulation should view an investigation by Ireland's national broadcaster RTE into Ireland's taxi industry 10 years after Ireland de-regulated its taxi industry... Supporters of taxicab deregulation argue that such deregulation causes the following benefits:[35]
lower prices, because more taxis are competing on the market;[35]
lower operating costs, incentivized by the competition;[35]
the competition adds quality and the pressure to enhance one's reputation;[35]
new innovations such as shared-ride markets and special services for the disabled, new market niches;[35]
the demand for taxi services increases, as the prices fall and the quality improves.[35]...

Deregulation advocates claim that the taxi service level increases most in the poorest sections of the city. The effect is highest in peak hours and bad weather, when the demand is highest.[35]
Deregulation advocates also claim that, in a deregulated environment:[36]
black market taxis become legal, possibly eliminating their problems,[36]
cities save money, as they do not have to plan and enforce regulation.[36]...

In almost all deregulating cities the number of taxis increased, more people were employed as drivers, and, deregulation advocates claim, apparently needs were better satisfied.[37]

Existing taxi companies may try to limit competition by potential new entrants. For example, in New York City the monopoly advantage for taxi license holders was $590 million in the early 1980s. The city has 1400 fewer licenses than in 1937. Proponents of deregulation argue that the main losers are the car-less poor and the disabled.[38] Taxi owners form a strong lobby network that marginalizes drivers and taxi users. It also pays local government officials to uphold taxi regulation.[39] The regulators usually do not wish to rise against the taxi-owner lobby.[40] The politicians do not want taxi drivers to have a negative opinion of them.[41]

Taxi deregulation proponents claims that immigrants and other poor minorities suffer most from taxi regulation, because the work requires relatively little education. Regulation makes entrance to the taxi business particularly difficult for them.[42] The elderly, disabled, housewives and poor use taxis more often than others.[35]

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Interesting, no?

I think so. I'm sure I'll get lots of comments from cab drivers & social engineers. And I know that regulation also has its proponents. I just Wonder how many of those proponents are happy paying $20 for a cab ride that costs me the price of a loaf of bread :)