Abstract

The Ict revolution (smartphone applications) have far reaching implications for nonscheduled urban transport taxi and cab services. The regulation of this industry is still backward looking, and it makes it hard for «apps» to convey the gains from easy access to old and new drivers and to consumers. Whatever attempt at reforming the industry regulation should provide for a fine-tuned arrangement to compensate incumbent taxidrivers for the depreciation of their old licences due to enhanced competition from new entrants. We discuss arrangements such that the cost of the compensation is not a burden on taxpayers.