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Ulric B. and Evelyn L. Bray Social Sciences Seminar

Tuesday, May 8, 2018
4:00pm to 5:00pm
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Baxter B125
Frictions in a Competitive Regulated Market: Evidence from Taxis
Alessandro Lizzeri, Professor of Economics, New York University; Moore Distinguished Scholar, Division of the Humanities and Social Sciences, Caltech,

Abstract: This paper presents a dynamic general equilibrium model of a taxi market. The model is estimated using data from New York City yellow cabs. Two salient features by which most taxi markets deviate from the efficient market ideal is the need of both market sides to physically search for trading partners in the product market as well as prevalent regulatory limitations on entry in the capital market. To assess the relevance of these features we use the model to simulate the effect of changes in entry and an alternative search technology. The results are contrasted with a policy that improves the intensive margin of medallion utilization through a transfer of medallions to more efficient ownership. We use the geographical features of New York City to back out unobserved demand through a matching simulation.

For more information, please contact Letty Diaz by phone at 626-395-1255 or by email at [email protected] or visit the full paper, "Frictions in a Competitive Regulated Market: Evidence from Taxis," here..