[baddox]

> However, there are things that I (and I believe the population at large) value that cannot be optimized using simple market dynamics with no regulation. For example, I expect there to be taxis on the road, even if the demand is very low.

Can you explain why these things that the population values at large would not be profitable? Obviously that can be true for public goods, but individual or small group point-to-point ground transportation (taxis) is not a public good. The fact that you expect things that are extremely inefficient is not a very good reason.

[tomp]

Just because it's fulfilled by private companies does not mean it isn't a public good. I believe that transport, especially inter-city transport (which has many more externalities than intra-city transport - e.g. traffic, pollution, mobility) should be managed as a public service. Many cities agree.

Simply said, the fact that I can always get a taxi makes it more viable for me to not own a car. Less cars in a city mean more space and less traffic, both of which are desirable for the entire population of the city, and both of which have significantly more positive payoff than the cost of some minimum amount of taxis on the street at all times. Therefore, in my eyes, it makes sense to enforce such minimum via regulation, even though it is not profitable (and will manifest itself in an increased fare for other, more profitable rides).