A Model of Taxi Service Under Fare Structure and Fleet Size Regulation

John Schroeter

Staff General Research Papers Archive from Iowa State University, Department of Economics

Abstract: This article presents a model of taxi service in a regulated market where radio dispatch and airport cabstand are the primary modes of operation. Regulators have the potential to affect market performance through two means: changes in the number of licensed cabs and changes in drivers' mode choice incentives brought about by revision of the rate structure. The model admits the possibility that certain regulatory reforms may benefit taxi drivers and customers simultaneously. The questions of whether these possibilities actually exist in a particular market are addressed empirically. (Reprinted in The Economics of Transport, vol.II. ed. H. Mohring, Edward Elgar Publishing, 1994.)

Date: 1983-04-01
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Published in Bell Journal of Economics, Spring 1983, vol. 14 no. 1, pp. 81-96

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