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If regulation is the only think keeping the incumbents on top for something like a car service, then that’s a problem.
by horns4lyfe 5y ago
If regulation is the only think keeping the incumbents on top for something like a car service, then that’s a problem.
- musicale 5y agoI was actually describing the opposite situation: regulations helped the newcomers (who evaded them) and hindered the incumbents (who did not.) In the case of taxis, while the medallion system (for example) gave medallion owners a monopoly on regulated "taxi" service, it also discouraged (or outright prevented) them from expanding services and competing effectively against Uber. Moreover the monopoly market's reduced competition did little to encourage innovation or service improvements. That being said, your point is a good one in general, and the same result (regulation preserving incumbents - for a time at least - by increasing barriers to entry and shielding them from competition) repeats itself over and over. One could imagine a powerful company (Facebook) welcoming regulation as a way to preserve or prolong its dominance by creating a regulatory burden that potential competitors would struggle to overcome.