Washington Post Weighs in Against Taxi Medallions

Great news from Washington, D.C.! The Washington Post editorialized against adopting a medallion system to regulate the District’s taxis as some councilmembers have recommended. In an editorial (May 21st), the editors noted:

There are drawbacks to a system that restricts supply and creates barriers to competition. A memo dated Jan. 4, 2010 by Fitzroy Lee, a deputy in the CFO’s Office of Revenue Analysis, detailed the study of medallions in New York, Boston, Chicago, San Francisco and Miami-Dade County. Researchers found consensus among economists that medallions benefit a small group of citizens, namely the first round of recipients, at the expense of consumers and drivers without medallions. “Evidence from other jurisdictions,” Mr. Lee wrote, “suggests that limiting entry into a taxicab market leads to a decline in overall service: consumers pay higher fares, wait longer for an available taxicab, face more service refusals, and receive less service than they would otherwise.”

We’ve also commented extensively on taxi regulation and the proposed Washington, D.C. legislation in particular. See here for my oped in the Washignton Post (April 1, 2011) and an extended follow-up blog post here (April 14, 2011). I have commented on the corrupt nature of taxi regulation here (also in the Washington Post) and here.

Samuel R. Staley, Ph.D. is a senior research fellow at Reason Foundation and managing director of the DeVoe L. Moore Center at Florida State University in Tallahassee where he teaches graduate and undergraduate courses in urban planning, regulation, and urban economics. Prior to joining Florida State, Staley was director of urban growth and land-use policy for Reason Foundation where he helped establish its urban policy program in 1997.