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were there ever too many taxi companies? What harm has this caused? Do the flaws outweigh the benefits?

This is a factor of the overcrowding argument, the consumer benefits, however the individual business does not, let's use vendors instead of taxi's: A vendor that has been in the area for longer, and has greater capital will be able to lower his prices more than any new business, as a result the newer ones go out of business, and the older ones are able to establish a monopoly.


My point is that if you don't limit the number of vendors in a certain area, it's going to turn into a bazaar rather than a sidewalk.

The effects of over crowding would likely be felt hardest by new businesses. This wouldn't give the new guy a chance in the market.

Actually, quite the opposite. High traffic areas are great for those starting a new business! When your name isn't very well known, it's generally a good idea to go somewhere crowded so people have a better chance of stumbling onto your stand.

Yes, when there's a lot of competition, it can be harder to stay in business. However, you can't kill competition to help small businesses, because the competition you're destroying/preventing are also small businesses. It's better to let the customers choose who does and does not go out of business than to allow the government to choose, or in this case, it's more of a first come first serve deal.

With an area over crowded with vendors the vendors themselves could also cause such a problem. At the very least over crowding increases the likely hood of this happening along with accidents as a result.

I believe it's easier to wait and see if a problem even escalates before it's fixed. Chances are, this won't happen. However, in a world such as ours, the unlikely is inevitable, so it is bound to happen one place or another over time eventually. For the other places where problems don't escalate, well, it's a happy ending. : )

This is a factor of the overcrowding argument, the consumer benefits, however the individual business does not, let's use vendors instead of taxi's: A vendor that has been in the area for longer, and has greater capital will be able to lower his prices more than any new business, as a result the newer ones go out of business, and the older ones are able to establish a monopoly.

That's not quite how business and efficiency works. I'll get to that later when I have more time.

When you limit the number of licenses, the people who already have a license gain the advantage anyway because the new businesses can't even get started until they lose theirs or someone else loses theirs. A limit automatically makes the older and bigger business the winner, whereas having no limit forces the bigger business to compete.

Actually, quite the opposite. High traffic areas are great for those starting a new business! When your name isn't very well known, it's generally a good idea to go somewhere crowded so people have a better chance of stumbling onto your stand.

Yeah crowded with customers, not competition. That's what doesn't give the new guy a chance.

Yes, when there's a lot of competition, it can be harder to stay in business. However, you can't kill competition to help small businesses, because the competition you're destroying/preventing are also small businesses. It's better to let the customers choose who does and does not go out of business than to allow the government to choose, or in this case, it's more of a first come first serve deal.

restricting the number of people in a given area isn't killing the competition, just allowing those who are new to compete. It's also not always the customer who get's to choose. Business can often use forceful tactics making this moot.

Yeah crowded with customers, not competition. That's what doesn't give the new guy a chance.

It depends on the business. When you're talking about restaurants and vending, it isn't necessarily a bad idea to set up where there are crowds. The more people, the more likely some will decide your place looks good, or the more likely someone will pick yours because the line isn't quite so long.

A chance is the ability to go up to bat and take a swing. If a new guy starts a business, there's a chance he will strike out. However, that's still a chance he had to owning a successful business. When the spots are filled, you don't even get a CHANCE to even compete with everyone, or be competed against.

I should also point out that there isn't any room for the new guy if you limit licenses. If there's only room for 20 people in a certain area, then nobody knew can move into that area. In 10 years, the same 20 people can hold a license. Sure, the new guy didn't go out of business competing with these old business dogs, but that's because they didn't even have a chance. By limiting licenses, there will be fewer "new" guys. Without a limit, you might have 10 more new guys come in, which means one third of all the businesses are fairly new, which is a lot of competition and stress on the older businesses (it's stressful for everyone, but that's business!).

restricting the number of people in a given area isn't killing the competition, just allowing those who are new to compete.

Well, no. When the limit is reached, there is no new business that can compete and potential new business owners are now unable to open up their own business.

By restricting the number of businesses in an area, you probably aren't killing competition, but you're restricting it. If 10 people go into business when the limit is 15, they have less people to compete with, meaning they will stay open longer. By staying open for a long time, new businesses will never be able to replace them. If you have no limit, businesses can constantly compete with these bigger businesses and if the businesses are to remain open, they will have to make sure they offer lower prices and/or better service than their competition to "stay on top".

Business can often use forceful tactics making this moot.

Businesses are NOT allowed to force people to buy their product. This is illegal. Businesses can compete with one another, and they can compete by lowering their prices. If a big businesses does put their smaller business competition out by lowering their prices, then you end up with a cheaper product (so the consumer still wins!). If the little business is able to make a profit while the big business tries to undercut them, then the big business will either have to find a way to recover from the debt by selling more expensive goods or they will go under, which means people will now be able to buy from a cheap competitor (remember, if the competitor never moved in, the big business wouldn't have lowered their prices in the first place). If both the businesses are unable to force the other one under and they both are profitable, then the consumer has more options while the businesses are able to make a profit (which is a good thing). No matter what, the consumer wins.

As I said before, you can't eliminate competition in hopes of easing the stress off a small business by preventing the existence of other small businesses. If you want to increase the number of small businesses, then your best bet is to get rid of the limit and allow as many small businesses to open up as possible in hopes that a few will succeed.

Oh, and another thing, the politicians pushing the medallion system never argued that limiting the number of taxis would help new businesses. IN FACT, they argued that the reason they want to push the medallion system is because they want to ease the burden off of those who have been in the business for the longest and aren't foreign. One of the people who pushed the medallion system actually owned a taxi service himself, I wonder why he would want a system that would make it so that other taxis can't compete? This is the opposite of allowing new businesses to thrive.

If a big businesses does put their smaller business competition out by lowering their prices, then you end up with a cheaper product (so the consumer still wins!).

Isn't this what Rockefeller did? Although he went ahead and raised all the prices once the competition was dead. Granted we have laws against monopolies now, but since consumers tend to shop based on convenience, you eliminate the competition in a certain range and you can still make it without establishing a monopoly.

Granted we have laws against monopolies now

When was the last time you saw one of them enforced? Dare I point out MICROSOFT???

Dare I point out MICROSOFT???

Dare I counterpoint Apple?

As for the stats no matter what source you find that is accurate shows Apple having even 10% of the market.

And at 10% of the market, it's worth the most.

I am sure that is why Bill Gates is worth 53 B and Steve Jobs is worth 5.5 B.

His company's older, means more time to accumulate profit.

Isn't this what Rockefeller did? Although he went ahead and raised all the prices once the competition was dead.

I don't know much about Rockefeller, but from what I understand he greatly reduced the cost of oil by about 50%?

According to this article, the price of refined petroleum went from over 30 cents a gallon in 1869 to 10 cents in 1874, and to 5.9 cents in 1897.

The second article also talks a little bit about Microsoft as well. Both companies gained monopolies by offering once expensive goods at incredibly cheap and affordable prices. Small businesses couldn't compete because they couldn't produce quality goods at such cheap prices.

The monopolies were not gained by exploiting consumers, but rather by giving the consumers a product they wanted at an affordable price. This is unlike monopolies gained from politicians creating laws that help businesses unfairly eliminate competition.