Assessing and Reforming Vancouver's Taxi Regulations

This study assesses provincial taxi regulations on entry, fare, and trade in a Greater Vancouver regional context. Substandard taxi regulations explain why Vancouverites pay more for taxi service and wait longer to be picked up than in most other regions. The regulations impose additional costs on society, while doing little if anything to raise drivers’ incomes. The sole beneficiaries are the taxi license owners who earn super-normal profits because competition is tightly restricted. This study examines case studies to identify a regulatory regime that maximizes society’s welfare; this is a “pro-consumer” regime with free entry, deregulated fares, and no barriers to taxis picking up riders outside their home municipality. However, policy reforms need to be crafted to overcome acute industry opposition to liberalizing the taxi market with the associated loss of license values. Sequential reforms are proposed to open the market by dividing stakeholders and broadening public, consumer, and environmental support for change.