An Uber Effect on Medallions?

An Uber Effect on Medallions?

taxi

On the other side of our fair Commonwealth, the taxicab system is quite a world away in terms of regulation.  While Pittsburghers following the ridesharing debate in 2014 might have gained an understanding of the inner workings of the Public Utility Commission and its regulation of taxicabs in the City and other parts of the state, Philadelphia’s Parking Authority regulates taxicabs in that City and operators need a medallion to operate.

The regulatory environment leads to a restricted supply of cabs, making medallions quite valuable.  An article examined the performance and ownership structure of medallions in large American cities in light of the competition being brought by ridesharing companies.  One of those cities was Philadelphia, which just held an auction at which no bids were taken on the Authority’s bid price of $475,000 per medallion.  There are other reasons that have been speculated upon, but it could be an effect of new entrants into what has long been a hard to enter business.   Without medallions, Pittsburgh and other parts of Pennsylvania will never get to see the outward signal of what happens to the price to get into the cab business as more options become available.