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Taxis versus Uber: The Regulations, The People, The Money and The Future

The ride-hailing service Uber is only six years old, yet it has already inspired a host of imitators, such as Lyft, Wingz and Taxify. It has also sparked fierce opposition from the taxi industry, which is being undercut by Uber’s business model. This policy backgrounder from the National Center for Policy Analysis examines the battle between taxis and ride hailing services, and looks at how regulations have the potential to tilt the field toward the taxis.

The paper begins by overviewing how taxis cornered the ride sharing market. It then gets into what makes Uber different than the traditional taxi industry, the demographics of both industries, the safety issues that come up and the driver pay. It then examines how both sides have responded to the other, and the future possibilities of war or collaboration. The report concludes that if Uber continues to operate under its current model, the taxi industry will be forced to evolve to remain relevant. If they fail to do so, Uber could force them out of the market entirely or, at the very least, provide a more customer-friendly business model that is responsive to market demands. However, if Uber is outlawed or forced to adopt taxi industry regulations, any impetus for taxi providers to change would be diminished or lost. In that case, ride-sharers, both drivers and passengers, stand to lose.

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