A diagrammatic analysis of the market for cruising taxis
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Date
2006
Journal Title
Journal ISSN
Volume Title
Publisher
PERGAMON-ELSEVIER SCIENCE LTD
Abstract
A diagrammatic approach is used to study the characteristics of the cruising taxi market. For cost modeling, both taxi operator and passenger are taken as service producers. The former provides his vehicle operation and the latter, his waiting and travel time. Market demand is defined as a function of generalized price. It is shown that under short and long run conditions a unique equilibrium exists for a deregulated industry and it corresponds to a monopolistic competition. The relations among the free market equilibrium, social optimum and second best solution are analyzed. Regulations are studied in order to find their social convenience. (c) 2005 Elsevier Ltd. All rights reserved.
Description
Keywords
cruising taxis, monopolistic competition, regulation policies, COMPETITION