December 8, 2015

An Uber Good Way to Even the Playing Field

Liya Palagashvili

Affiliated Scholar

Ryan Friel

Summary

Start-ups are headlining the news as their business models and services collide with long-established regulations. Many of these regulations are textbook examples of laws that benefit a special interest group. Take, for example, taxi companies: One of the major obstacles facing ride-sharing services is the opposition of a strong, concentrated special interest group. For the taxicab industry, it is worth the time, effort and money to build political relationships and to hold protests against companies like Uber and Lyft.

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Start-ups are headlining the news as their business models and services collide with long-established regulations. Many of these regulations are textbook examples of laws that benefit a special interest group.

Take, for example, taxi companies: One of the major obstacles facing ride-sharing services is the opposition of a strong, concentrated special interest group. For the taxicab industry, it is worth the time, effort and money to build political relationships and to hold protests against companies like Uber and Lyft. The benefits taxis obtain from a successful lobby are large and concentrated: They restrict their competition and obtain higher profits. The taxi industry also has a strong incentive to stay on top of the ride-sharing developments that could threaten its own viability.

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