further: >... cabbies in most major cities are almost certain to give you a much higher rate if you hail them at the airport or a railroad station - it is a well known fact. <
If I'm not mistaken, that's the way cab rides are priced currently, under city regulations. But then again I seldom ride in cabs (except at Econ. conventions).
Frankly, I think the discussion of cab pricing is off the point, especially since Mayor Rudi isn't going to abolish the medallions. Patrick Bond's comment on cabs really finished this thread: without regulations, cab competition threatens to turn into a miniature Hobbesian war. It's like the newspaper industry before industry self-regulation (the Audit Bureau of Circulation, my late father's employer), where one newspaper would sabotage the distribution of another, sometimes killing "newsboys," etc. (in Chicago at least). Without either government regulation or industry self-regulation to maintain "standards", many competitive markets tend to degenerate into the worst kinds of cheating and fraud. (IMHO, capitalist government regulation is typically nothing but industry self-reg writ large. This includes the Fed.)
BTW, is there an economics literature on industry self-regulation?
Jim Devine jdevine at popmail.lmu.edu & http://clawww.lmu.edu/Departments/ECON/jdevine.html "A society is rich when material goods, including capital, are cheap, and human beings dear." -- R.H. Tawney.