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November 26, 2016

Taxi Industry In India: A Story Of Bootleggers And Baptists - Swarajya

Shreyas Bharadwaj of Swarajya does a detailed coverage of how players in the taxi industry are affecting changes to regulations through the prism of Bruce Yandle's Bootleggers and Baptists.
"..many states in the United States (US) had laws which banned the sale of alcohol on Sundays (the days Christians go to church). These laws were not only supported by conservative baptists, who viewed alcohol as demonic, but also by bootleggers (illegal traffickers of alcohol) who made good money selling alcohol illegally on Sundays at higher prices. While baptists would publicly lobby for the Sunday ban on the sale of alcohol, bootleggers would help out local politicians who were (and are) perennially in need of re-election funding. The law banning Sunday sales would contain no provision for banning the consumption of alcohol."
And what about the consumer? The answer is simple; they get the short end of the stick. The higher prices due to the ban make their pockets lighter. In effect, it is the (un)holy alliance of baptists and bootleggers which would cause prices to increase. 
So who are the role players in the Indian taxi industry?

1. Bootleggers are established taxi players who are actively lobbying to prevent others (Ola, Uber, etc) from legally competing with them and raising the cost of operations for these new competitors

2. Baptists are the ‘consumer protection’ activists who continue to spread hysteria over surge pricing and safety of using taxi aggregators, demanding that government equalise the playing field and more through the media.

Click here to read on how their interests are driving regulatory changes and how regulation is affecting the industry.

Image Credit: R Street

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