Topic: Regulatory Studies

Latest Essays in Cato’s Growth Forum

Today we add the following essays to Cato’s online growth forum:

1. Enrico Moretti wants to increase the R&D tax credit.

2. Daniel Ikenson calls for more foreign investment.

3. Scott Sumner argues for better monetary policy based on nominal GDP targeting.

4. Don Peck worries about growing dysfunction in the middle class.

5. William Galston offers a potpourri of proposals for faster, more inclusive growth.

6. David Audretsch highlights the central importance of entrepreneurship.

The remaining essays will posted next week.

Today in Cato’s Growth Forum

There are five new essays today in the Cato Institute’s online growth forum:

1. Ryan Avent argues against restrictive zoning.

2. Jagadeesh Gokhale makes the case for tax and entitlement reforms.

3. Michael Strain wants to put America back to work.

4. Karl Smith thinks about how to counter slowing labor force growth.

5. Robin Hanson calls for the meta-policy of decision markets.

Can Taxis Survive the Rise of Ridesharing?

If taxi drivers want to endear themselves to consumers, they had better find another way of protesting ridesharing companies than deliberately congesting traffic. On Monday night, taxi drivers with the San Francisco Taxi Workers Alliance caused traffic jams at San Francisco International Airport in the wake of last month’s news that the airport would allow rideshare vehicles to pick up passengers as part of a pilot program. Unsurprisingly, airport visitors were not pleased. This kind of protest has a track record of failure, and in the coming years these protests may be remembered as being among the most frantic and ultimately unsuccessful attempts taxi drivers made to combat the rise of ridesharing companies such as Uber, Lyft, and Sidecar. 

Taxis have deliberately congested traffic in rideshare protests not only in American cities such as San Francisco and Washington, D.C., but also in London, where the protest earlier this year reportedly resulted in an explosion in British Uber sign-ups. In Washington, D.C., the city council passed a rideshare bill in a 12-1 vote despite the protest.

Taxi drivers are right to be worried about ridesharing. In San Francisco, there has been a dramatic drop in the number of taxi trips since the beginning of 2012, the year Uber’s ridesharing service and Lyft both launched. In September 2014, the general manager of a Washington, D.C., cab company said “what we are seeing is, year over year, an approximately 30 percent decrease in business.” A draft study from the Virginia Department of Motor Vehicles reportedly predicts that once rideshare regulations are permanently in place in the state, rideshare drivers will outnumber taxis.

Many consumers have demonstrated over the last few years that they prefer rideshare services to taxis. Market incumbents such as taxis have a number of options when competitors arrive on the scene, but it is hard to see if any will halt the growth of ridesharing. 

Taxi companies could try to innovate to keep up with the technology used by Uber, Lyft, and Sidecar. What many people like about ridesharing is the ease of use. All users have to do is press a button on their smartphone in order to get a ride that is paid for automatically without cash. Hailo, a company with an app similar to the apps offered by ridesharing companies, provides a way for passengers to hail a taxi via smartphones. However, Hailo recently announced that it would be leaving North America because of the competition from Uber and Lyft. Given that anyone who can download a taxi app also has the ability to download a ridesharing app, it is hard to see what a taxicab app would be able to offer that ridesharing companies don’t already provide. Of course, it is not inconceivable that the taxi industry will develop a competitive app, but it will be difficult for that app to succeed considering that rideshare companies already enjoy name recognition as well as a loyal customer base.

Today in Cato’s Growth Forum

Cato’s special online forum on reviving growth continues today with the following new essays:

1. Morris Kleiner makes the case against occupational licensing.

2. Tim Kane calls for more immigration.

3. Alan Viard advocates moving to a progressive consumption tax.

4. Donald Marron argues for a carbon-corporate tax swap.

New in Cato’s Online Growth Forum

Here are the newest essays in the Cato Institute’s online forum on reviving growth:

1. Ramesh Ponnuru offers three ideas – on taxes, patents, and money.

2. William Gale argues for getting our fiscal house in order.

3. Jeff Miron proposes cuts in health insurance subsidies.

4. Adam Thierer calls for a culture of permissionless innovation.

New Essays in Cato Online Forum on Growth

Here are the latest entries in the Cato Institute’s online forum on reviving growth (see here for some more background about the forum):

1. Tyler Cowen contends that foreign policy can have a major impact on long-term growth.

2. Heather Boushey argues that a national program of paid family leave will boost labor supply and therefore growth.

3. Eli Dourado proposes incentive pay for Congress.

4. Peter Van Doren cautions that there are no easy answers.