The problem with this argument is that anti-competitive regulations that restrict the size of the taxi market probably do not maximize government revenues. The

The problem with this argument is that anti-competitive regulations that restrict the size of the taxi market probably do not maximize government revenues. The government would probably receive greater revenues if it deregulated the market since more people would take cabs, albeit at somewhat lower fares. The more significant dynamic behind regulatory capture is the simple fact that the groups who are most interested in taxi regulations and the membership of CPUC, and who are most incentivized to lobby for advantageous laws and to try and get friendly people on the Commission, are the very taxi firms being regulated.