A license shouldn't be sold. I cannot sell my driving license. A license should be acquired through a standardized test and a reasonable amount of people should be able to pass the test each year. The current medallion system which works in a majority of western countries is just corruption.

People would take the taxi way more if it was cheaper, thus buying less cars and polluting less. This is especially true in Paris where a ride to the airport is 70€ ! unbelievable (Uber is 50€).

  A license shouldn't be sold. I cannot sell my driving license. 

There are different types of licenses. The driver is still licensed: e.g. in NYC they need a "New York State DMV Chauffeurs License" and they can then apply for a "New York City Taxi Driver license", which includes a standardized course and exam [1].

The taxicab medallion licenses are separate: they are not a license to drive a taxi, they are a license to operate one.

The licenses relating to peoples' competence cannot be sold, but the ones relating to operating a taxi can be.

[1] http://www.drivers.com/article/1162/

Nonetheless, if the purpose of a license is to verify that a particular person or business entity has satisfied some regulatory requirements that allows them to engage in the licensed activity, the ability to sell that license to other unverified persons or entities would seem to defeat the purpose of having a license in the first place.

If there's no regulatory requirements, then license is basically just an access fee to gain entry to a market artificially closed off by the government. It's just cronyism. What is the benefit to the public if the license is not providing some assurance of suitability of the license-holder?

  if the purpose of a license is to verify that a particular person
  or business entity has satisfied some regulatory requirements

That's not always the purpose of a license. In some instances, the license is to regulate access to a particular activity or device (e.g. gun licenses, or driving licenses).

In some instances it's simply a tax on an activity (UK TV license, UK road fund license).

In some instances, it's to manage a resource (fishing quotas).

  then license is basically just an access fee to gain entry to
  a market artificially closed off by the government.

That's not necessarily a wrong thing. In the case of fishing quotas, it's to ensure that use of the resource is sustainable.

I wouldn't argue that it's correct to apply that thinking to the medallion system - after all, I'm not sure the NYC population is going to be 'fished out' by an oversupply of taxis - and if it's to ensure a floor on taxi income so that the taxis meet a certain quality, then there are better ways (e.g. regulation) to do that.

I don't see that the sale of medallion licenses is an issue per-se, but that critiques of license-sales are essentially critiques of the medallion system itself.

> A license shouldn't be sold.

Many proponents of cap-and-trade schemes disagree.

I think throwaw181ay is making a different argument, which is essentially that you should license the people (e.g. like a driver's license, which indicates proficiency) and not the thing, which is (basically) the car.

And they do -- you acquire the taxi driver certification ("this guy has good eyesight, isn't a criminal, knows the taxi rules") independently of the medallion ("no more than N cabs may be operating at any given time"). The two regs accomplish different purposes.

As the parent notes, in certain setups (like cap and trade) the tradeability of the license is important for ensuring that the restricted resource is used efficiently: the most economical emitters of carbon get the rights, and the most economical drivers get the medallions.

> the medallion ("no more than N cabs may be operating at any given time")

The whole point of this is to ensure that the price for taxi rides is higher than what the market-clearing price would be. In other words, it's a scam to rip off gthe consumer.

(Similar arguments apply to zoning regulations and house prices, of course)

There are good motives and bad motives behind every law. I don't find it productive to assert, as fact, that the malicious stuff is only kind, without addressing the good that they're ostensibly accomplishing.

You might as well dismiss all cap-and-trade proposals as being "just another scheme to raise energy prices".

As far as I knew, taxi licenses were there specifically to certify that the driver was trustworthy. After all, the service involves getting into a stranger's car...

A cap-and-trade scheme is a reasonable option if your goal is to limit the quantity of something (like carbon emissions) while allowing the market to behave as normal otherwise.

But there's no direct reason to limit the number of taxis. People suggest that limiting the supply ensures drivers make a decent living, but if you want that, employment law (e.g. enforcing minimum wage for drivers) is a more direct solution.

Considering the negative externalities of taxis on their environment (noise, pollution, congestion, and of course occasionally killing people) there are quite likely reasons to limit the number of taxis.

>(noise, pollution, congestion, and of course occasionally killing people)

Again, if we want to limit these things, we should make laws about them directly, rather than arbitrarily limiting one of their causes. Solutions to negative externalities should be primarily based on internalising those externalities, so the market has an incentive to seek alternatives.

What happens if someone invents a more expensive, but quiet and non-polluting taxi? (Which of course, they have.) If you limit the number of taxis, everyone uses the cheaper ones to maximise profit, and you still get some noise and pollution. Whereas if you tax the noise and pollution and it becomes cheaper to buy electric taxis, you've eliminated the noise and pollution entirely.

Banning license sales inter alia would increase the cost of a taxi. Increasing the number of licenses would decrease the cost.

How so? I'd say it's opposite. Today when you pay a taxi ride you're not only paying the driver and the maintenance of his cab, you're also remunerating the capital the medallion's owner. If medallions were not tradeable, you wouldn't have to pay for them.

The market price of a ride is based on the supply and demand of a ride. Not being able to sell a medallion will reduce supply. Holding demand constant, price will increase as supply decreases.

If a medallion owner is happy driving 10 hours a day, but a potential owner would be happy driving 12 hours a day, the current owner should sell to the more eager driver and supply of rides will increase. If the owner cannot sell, then supply of rides is stuck at a lower level.

If the number of medallions in circulation is constant, the market price of a medallion is not a causal factor in the cost of a ride. The causality goes the other way around.

And like the arrival of Uber, this was a massive boon for customers, and had unfortunate ramifications for the drivers.